How to Finance Your Small Business Start Up

It all starts with a great idea, an idea that has probably been in your mind for a long time. You have the product sorted out, how you are going to deliver your service, where you are going to set up your office and how you are going to market your new business. But the stumbling block always seems to be the finance to get you going.

Finding the finance to get a small business off the ground is a major issue for any potential small business. Some new businesses lend themselves to very little start up capital because the main selling point is the owner’s skills and knowledge, for example consultants, web designers, PR specialists. Businesses which require stock holding, plant and equipment and other investment, face the real challenge of getting their start up finance together.

So what sources can you tap into to ensure your business gets off to a solid start?

Your Savings

The first port of call! If you have been in employment for some time then before going it alone you should hopefully have some spare cash behind you. Whether this be in the form of cash in a savings account or shares and unit trusts, this is a good start to your fund raising exercise.

You can be more focused in saving cash if you have had the goal of setting up your own business for awhile. Knowing you need to save to get your business off the ground will make sure you don’t spend your future nest egg on unnecessary items. Whilst a new Plasma TV or the latest DVD Recorder may seem to be an essential purchase, knowing that you have a business to set up in the future will be sufficient a deterrent to keep the cheque book firmly locked away!

Keep Your Job

Some business owners are lucky enough that during the early days of the business they can keep the day job while working on the business during the evenings and weekends. This has two benefits. Firstly, they are still earning thereby allowing more time to build up a cash reserve. Secondly, it’s an opportunity to test out the business to make sure there is a market.

Make sure that you can realistically keep both balls in the air at the same time otherwise you will end up doing justice to neither your job or your new business. The support of your family is also essential if you are to follow this strategy. They have to accept that what used to be ‘family time’ may have to take a back seat until you decide to concentrate on the business full time.

Family and Friends

These can be a useful source of finance for any start up. If you have harboured ambitions to run your business for some time, then many of your family and friends are already likely to know about your idea. You should therefore have an indication who is for it and who is against it.

If you haven’t shared your secret desire then it’s time to be slightly devious! If you are in the early planning stages start drip feeding your ideas to key people whom you think are likely to support you. Tell them your ideas, share your ambitions and goals and on a regular basis update them with your progress. The plan is to get them sold on you and your future business at an early stage.

Once you get to the point where you are ready to start asking for contributions hold an Investor Evening. Prepare a presentation outlining your plans, the business, the market etc. Show the potential investors what their return will be in recognition for supporting you.

Invite as many people as you can and promise an interesting and fun evening, Be bold at the very start; tell them exactly why they are there, so there are no misunderstandings. After you have done your presentation gather all the names of the people who may want more information or even a one-to-one with you.

Whilst this group are people who know you and so are more likely to trust you, don’t forget that you are developing a very different relationship which can quickly turn sour. Be prepared for rocky times!

Bank Line of Credit or Loan

Now you’re getting into the serious stuff! Getting support from a Bank for a new business is tough, as many entrepreneurs will testify. One sneaky way is to apply for an unsecured loan while you are still in employment. If you have planned things right you will know when you are starting up, so a few months before you pack your job in, apply for a loan based on your salary. However, make sure that you can comfortably meet the repayments. There is no grace period; you will be expected to pay back immediately, so your business will have to start earning very quickly.

The alternative is a business line of credit facility. There is no fixed repayment date, although they will be for periods from 6 to 12 months, and all you have to do is ensure that you keep within the overdraft limit. You will have to write a business plan to present to the Bank which outlines your idea and the business.

Mortgage or Equity Release

With the way house prices have been increasing over the last few years, the vast majority of people now have substantial equity in their homes. The cheaper alternative to a Bank overdraft or loan is a mortgage. The interest rate is lower and, as the repayments are spread over a longer period, the monthly repayment is less (although you will end up paying more interest in the long run).

The disadvantage of raising cash this way is that your home is potentially at risk. If meeting the monthly repayments is dependent on what the business can generate then a slow start could cause cash problems. So be very sure you can meet the repayments even during a lean period.   

Credit Cards

If you haven’t got any savings, can’t get support from family or friends, or a Bank loan or mortgage, then there are your credit cards! However, whilst it’s easy to draw down on your card, be wary! Credit cards are the most expensive form of debt.

They are ideal because all you may have to do is pay the minimum amount but card debt, as most people have found out, can be a long term burden. But, if you need a cash lump sum to kick start the business and you know you can pay it off within a few months, then it’s an alternative source of finance worth considering, if somewhat unorthodox!

Business Grants

Business grants are available for specific industries, sectors and reasons. Grant providers will usually only give a portion of your requirement, so they cannot be used to totally finance a start up. However, they can be useful in filling a funding gap.

Business Angels

A popular way to fund a business are Business Angels. These are people, usually retired or successful business people in their own right, who are looking for opportunities to invest in new businesses.

In exchange for an investment they will typically look for a shareholding in the business and some hands-on involvement. They will have a vast business experience and so are useful people to have on board. However, you will have to accept an element of loss of control but that needs to be balanced against your desire for funding.

Getting finance for your new business can be a challenge but there are a number of avenues to explore and so with dedication and focus you could soon be on your way to launching your own small business.

© Robert Warlow       

Small Business Success        

Small Business Web Designing

In today’s web world, online marketing and e-commerce is an integral part of any business strategy. Small businesses are less on capital and marketing funds. A website helps the small business to reach a greater customer circle and be known to clients worldwide. Also the customers can get an easy access to the services of the business. The investment on designing a website for small businesses is less. Hence, the web site will not be known to all the targeted viewers.

More and more small businesses are investing more on web marketing in order to increase the viewers to convert them into potential customers. Small business web designing is an easier process since the web pages required is lesser. The links to the pages are however very less. This results in the web site not appearing in the top results in a search page.

A small business web designing is done by various firms that are expert in the field. Since the amount invested into designing is less, the website contains lesser contents. The designers create simple looking pages with fewer contents. Precise articles regarding the business and its service is displayed in the web pages. The designers see to it that the most likely targeted keyword appears in the HTML title text. The keyword should also appear frequently in the HTML body text. This ensures the web page to be displayed to the viewers who are searching with the targeted keyword in mind. The next objective of small business web designing is to optimize the site. This can be done by search engine optimization technique which helps the website to appear higher in ranking in search results.

The above methods help the business to market itself to the targeted customers and also establish them in the desired market. But in order to design the right web site as mentioned previously, the owner of a small business has to invest considerably more on designing. Although an online marketing and e-commerce can provide an increment in customers, it does not necessarily contribute in complete success of the business.

There are various firms and online designers who provide the best small business web designing for business owners. Some of them are listed below

W3 EDGE

This is a Boston, USA based establishment. They provide one of the best web design solution for businesses across the world. Their goal is the success of their clients business by providing design and e-commerce solution. They offer flash designing, I-marketing and programming. They provide the search engine optimization technique to help the business be viewed by a greater number of customers.

Ai Studio

This is a New York, USA based designing firm. Their clients are spread across USA, UK, Australia, Europe, Asia and Africa. They provide excellent web designing, logo designing, photography, 3D/flash animation, e-commerce solution, search engine optimization and internet marketing.

Hoover Web Design

This USA based designing company provides latest designing solutions for small business web design required. They provide web design, maintenance, web builder, search engine submission, domain name registration, e-commerce solution and web hosting.

FocusSpeed.com Launches a New, More Convenient Source for Semiconductor Related Stock Photos

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FocusSpeed.com Launches a New, More Convenient Source for Wine Related Stock Photos

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FocusSpeed.com is a good source for those who publish magazine and ads, brochures, direct response, internal communications materials, and websites. All the images have been pre-approved by FocusSpeed.com’s staff for quality and resolution, making them ideal to use for tradeshow marketing material, websites, print advertising and editorial use.
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About FocusSpeed
FocusSpeed was started in 2004 as a stock photo agency which allows the user the ability to purchase individual pictures or join as a subscription based member. Simply sign up for an affordable subscription plan and download unlimited images every day with no hidden costs. Our vast collection includes premium, royalty-free photographs and images you won’t find anywhere else. Combined with a user-friendly model, FocusSpeed is your resource for quality stock photos on the web.

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