Owning and operating a small business is hard. Nine-to-fivers assume that it means working less and making more. In reality, however, owning your own company -- and making your dream come true -- means long hours, no paid sick days, and, sometimes, no paycheck. When your business needs to buy a piece of equipment or raise funds for prototyping, quite often the bank won't even talk to you. You aren't big enough yet and your profit margin may be too small. If you are determined, however, the sources below can get you the cash you need to keep moving forward.
1. Online Auctions: The quickest way to get cash for your small business is to sell something. Online auction sites let you sell almost anything. You set the terms and price and, once sold, ship the item to the new owner. This is not going to raise huge sums of money like the IPO of a hot internet company, but it will net you a few hundred dollars to buy a new piece of equipment.
2. Payday Loan: A payday loan is exactly what it sounds like. You show them proof of your weekly or bi-weekly paycheck, and they loan you a percentage of it. Payment is due on your next payday. Chances are, if your business is getting on its feet, you or your spouse still work a regular job and can benefit from this type of service. Yes, the interest rates are high, but cash advance loans are short term and get your business on to the next step.
3. Microloan: One of the hottest terms in finance is microloans. What originally started as a way to loan very small amounts of money to farmers in third world countries for their budding businesses has moved to first world countries as a way to loan small amounts of money -- less than $500 -- to small business owners. It may be just enough to help you move forward.
4. Factoring: If you have outstanding invoices from customers with payment dates that are 30 days out or more, factoring those invoices may be a good fit. Factoring companies are willing to purchase those invoice from you at a discounted rate. They get a quick return on their money and you get instant cash.
5. Online Fundraising: The hottest trend in raising capital for small businesses is online fundraising and crowdfunding. The concept is brilliant, really. Instead of getting a large, lump sum from one person or organization, you get small donations from many people. Some sites are strictly for donations, while others let you offer something in return. Several companies have launched as a start-up or moved on to their next phase via crowdfunding.
6. Credit Card Cash Advance: Many credit cards allow you to take a cash advance on your available credit limit. The interest rate is often higher on cash advances than it is on standard purchases. As you pay back the cash advance, it is important to realize what the payments are applied to. Some companies apply funds to purchases first, and then the (higher interest rate) cash advances. You can also consider transferring your balance to a card with a short term, zero interest offer, which could save you money in the long run.
7. Pawn Shop: Contrary to the Hollywood portrayal of pawn shops, they are clean, safe businesses that can help you out in a pinch. Not sure how it all works? Its pretty simple. You take in something of value and they hold it while loaning you a percentage of its value in cash. Each week you make a small payment -- with interest -- towards the balance until you re-pay what you borrowed.
Entrepreneurs usually do what it takes to get their business on to the next step. If the business needs cash to move up, then savvy entrepreneurs know to go out and get it. The sources above are not traditional ways to raise money, but they work.Share
24 June 2015
Hi there, I'm Tom Jensen. Although I'm normally quite good with my money, a series of unfortunate circumstances recently resulted in a tight financial situation. The money I had coming in didn't quite cover all of my immediate expenses. Although I had a check on its way, I needed money right then. Thankfully, I was able to go to the payday loan mart and obtain a cash advance. As soon as my other check arrived, I paid off the payday loan to keep my account in good standing. I would use this service again if I came across a similar situation. I hope that I can inspire people to appropriately use payday loans to alleviate stress caused by financial problems. This site will explore all of the different loan terms and types used by these facilities. Please come back to visit again soon.