Many businesses are looking for ways to increase the cash flow and this could be achieved through proper funding. When companies seek to expand their operations, they require more funding and this is a common thing in the growth stage. Their local market could already be saturated enough that the only way for the company to grow is by expanding to other areas, regions or countries. Here are sources of funding for small businesses:
When a small company is established, initial capital can be acquired from personal saving or various low-interest business loans. As newly founded entities, start-up companies need to have enough funding to allow them become a profitable organization.
Family and Friends
They can be encouraged to provide grant or loan for our business. When our company has reached a specific level of competency, our family and friends could see that our company has the potential for additional growth. If they are convinced about our business ideas, they will gladly provide enough funding for our company.
Crowdfunding is a relatively new way to fund our small businesses and it is based on crowd participation. In this case, many small investors are able to provide enough funds and this is an ideal thing to do during the early stages of our business. With online crowdfunding, individuals, groups, communities and networks pool their money to support something that they consider worthwhile. Small investors could support start-up based on their unique patent ideas, social awareness and others. Popular crowdfunding companies are IndieGoGo, Kickstarter, ChipIn, GoFundMe, GiveForward, RocketHub, Crowdtilt, Fundable and Crowdfunder.
Business grants are another source cash flow for our company. In each country, they could be organizations that provide long-term sources for small business grants. Each year, a specific number of businesses compete for limited numbers of business grants that may amount to a few thousands of dollars each. For true job creation and true economic growth, many organizations seek to participate by providing business grants.
Angel investors could provide non-demanding business funding for people who are able to achieve a consistent level of sustainable growth. They could invest up to $500,000 for a potential business. If our business reaches specific requirements, the investor will analyze our condition by assessing various factors to determine whether our company is a serious proposition. These investors could do due diligence before making a proper decision. Angel investors could become mentors, business advisors or a part of the management team. They could provide more funding as our businesses continue to expand and grow.
This option could be the first thing that businesses take when they plan to expand or grow. The fund could be used to purchase more equipments and expand into a larger office to accommodate more workers. In order to get repeated loans, businesses should establish good relationships with the banking institutions. It means that companies should have the ability to properly pay off the loan.