Do you have big plans to expand your business and take it to new heights? Are your goals and business growth limited due to lack of funding? If you answered yes to these two questions, you’re not the only business owner in Canada facing this issue.
The primary obstacle for many small business owners is having inadequate funding. 90% of all startups will face this dilemma within their first five years; for many small businesses it will be a make or break moment.
Kingsmen Capital has had vast success in helping small businesses achieve their goals. Helping numerous small businesses get the funding they need to grow is our passion. In doing so we have found the following six methods that are the best way to raise the money you need to be successful in this competitive market.
- Count On Your Savings
Your first option is to consider your own savings. This is because it costs nothing to use your own money. You have no interest to pay and nobody to answer to. Yet, you still need to be responsible in how you spend the money.
The most important thing here is to be aware of your expenses and savings. Never make the mistake of investing all that you have. Make sure to have at least one year of expenses safe in the bank account so that you do not have to turn to other options to pay the bill in case things go haywire in the future.
- Ask Friends and Family For Help
Do not be afraid of asking friends and family members for help. This is a good option because they are well aware of your potential and will not shy away from helping you if they are capable of doing so.
You may offer them incentives such as a share in the business or profit from the first few years. If that’s not your cup of tea, you may also draw up a proper loan contract and pay them interest on the amount of loan.
The benefit of asking friends and family members for a loan is the time saved in applying for al on through a bank as it involves a lot of red tape.
- Find the Right Financial Partner
There are several types of business loans out there to help businesses grow. You can opt for one that meets your needs the best and is also the most affordable for you.
For example, if you need to buy equipment to expand the business, you can decide to pursue equipment financing. It is the best way to buy new equipment with the minimum investment. However, if you actually need cash, you can opt for other types of small business loans or the right financial partners.
You should consider alternate financing institutions providing solutions to businesses that are not eligible to receive financing from banks, such as OnDeck and Kingsmen Capital, offering business loans in Canada. Kingsmen Capital assists many small merchants by providing them with a range of financing products including but not limited to small business loans, equipment leasing, sales leaseback financing and consumer financing options for businesses to increase revenue. Kingsmen Capital assists business owners to find various different financing solutions which are customized to cater to the existing needs of the business.
- Opt For Credit
If you have been in the business for a while you must have made some friends. These relationships can come in handy when it is time to grow a business. For example, you can ask your suppliers for supplies on credit with a promise to pay in the future.
This can be one way to grow a business as you can use the supplies to complete a big order and then pay the creditors from the profit.
A large number of businesses in Canada actually run on credit so it might be a good idea to look for this option-given that you are in good standing with your suppliers!
Crowdfunding is the new it thing. You can easily find a number of crowdfunding sources to raise capital for your business.
In crowdfunding, you basically ask the general public to help you achieve your goal by offering them incentives in return. The incentive can be in any form, but if you are looking for money to grow a business, you must offer monetary incentives to others unless you are running a non-profit organization or you actually plan on helping the world by giving back to the society with your business.
- Find an Investor
People are always looking for small businesses to invest into. If you think your business has the potential to be big, you can go on the hunt to find an investor willing to put money into your business.
While this option does work, it comes with certain side effects as in most cases the investor would like to have a large share of the profit and say in the business, which means you will eventually end up sharing the business with a third party.