For many SMEs, securing funding can prove problematic. This issue has proved particularly prevalent since the financial crash of 2007, which saw the economy grow increasingly volatile, and monetary institutions grow ever more reluctant to lend capital to businesses that really needed it.
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It is not only struggling companies or those with a poor credit record who have suffered from this attitude. Start-ups and fledglings businesses also find it incredibly hard to secure funding or investors. You could have the best business plan in the world, and you may still find it almost impossible to secure the capital to fund it.
However, this is only a problem if you’re unwilling to think outside of the box when it comes to raising finance. Your bank manager or mortgage lender may prove unwilling to help, but that doesn’t mean that one of the following options won’t be able to take their place and fund your venture.
Small Business Grants
If finding someone to lend you money is hard, how about not borrowing at all. Instead, take the time to research any grants that you might be eligible for. These are highly sought after, so they’re not the easiest form of funding to come by. However, they have many obvious benefits attached to them, and there are always grant schemes available. If you don’t find anything straight away, then don’t despair; new schemes are always emerging, so all you need to do is keep an eye out for one that suits you. To help you out, here are a few top tips for staying ahead of the competition and securing the funding you need.
Invoice Finance
Invoice financing is an increasingly popular funding option amongst SMEs. It works on the concept of borrowing money that you’re already owed. The company you choose will work on a system where they pay part or all of your unpaid invoice fees to you, to allow you to access working capital immediately. One of the major benefits is that you’re borrowing money that is essentially already yours, so you know you’ll be able to repay any debts that you accrue.
Crowdfunding
Crowdfunding is a relatively new concept, but it’s an interesting one and one that’s worth considering for your business. Money is raised online through a website, with members of the public pooling their resources and investing them in your business. Although many remain unfamiliar with the concept, there are lots of guides available to help you understand how it works and how to go about doing it.
How will you choose to fund your business?
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