Most people are good at running their businesses. But people are not so good at making good financial decisions. I love helping people make the right decision.
Small business finance without the headache.
SMEs account for 97 per cent of Australian businesses. And it can still be difficult to make a case to a bank when looking for finance to start a new business. Equally so when requiring cash to grow an existing one. The good news is that applying for commercial finance through a bank is far from the only option. Here are some alternatives:
1) Personal loans
2) Private funding
3) Raise the money
4) Talk to a Qualified Business Finance Broker
A young business -without a trackrecord- may not be looked upon favourably by banks. That’s because assessment and loan approval is based on risk. A lack of documented history doesn’t help abusiness loan application. In that case a personal loan could be the way to go. The downside may be slightly higher interest rates and lower loan amounts, buta personal loan can provide a good buffer for start-ups and is relatively easy to apply for.
Private funding is when individuals lend through a trust account. While it can be a little more costly than the average business loan, it carries the advantage of flexibility. If it’s a very challenging scenario, with no banks wanting to touch it due to complexity orbeing outside policy, then private funding would be an option.
Raise the money
Crowd funding can help raise the funds needed to finance a startup or a product. The two main types are:
1) Equity crowd funding, where a share of the business is offered in return for funds.
2) Reward scrowd funding, where a product or service is pre-sold prior to the launch of the business or product.
Talk to a Business Finance Broker
Talking to a good Busines Finance Broker means access to expertise and saving time. Matching your needs to the right loan type. As well as my expertise in matching your needs to the right loan type. A good Business Finance Broker takes a broad view of a business’s finance, assist in business planning, and uses his/her deep knowledge of your needs to look beyond a simple ‘lowest interest rate’ formula.
How to choose the right business loan
From time to time, a business needs a cash injection. With so many lenders offering a dizzying array of products, it can be difficult to know what to choose. There are so many different types of business finance and before diving in and applying, it’s important to understand your requirements. A loan must be matched to your needs so that you avoid apotential problem in the future.
How to select a business loan
There are different types of business loans to suit different stages of the business life cycle.
Understanding different business needs and selecting the right one can speed up the application process and minimise costs:
1) Finance for a start-up
It can be quite difficult to secure a business loan for start ups with a major bank. A lot of banks don’t have much of an appetite for startups. Some alternative are taking out an investment loan against the equity of your home or investment property or using one of the new lenders in the business landscape like get capital or Moula or Ondeck. And an investment loan can be a good alternative for anyone wanting to fund a new venture. It provides flexibility and you’re more likely to secure approval.
2) Finance for quick cash flow
Similar to a line of credit, a business overdraft can be drawn down to a certain limit. A business overdraft is an option. It provides the flexibility of accessing funds without much prescription. There are a lot of unknowns that arise in business that even the best business plans can’t cater for. This type of finance takes care of those unforeseen things.
3) Finance for expansion or investment
Get in touch if you need any help or have questions. We are passionate about looking after business owners and their finance needs.