Written by Salina Jivani
You’ve got a brilliant business idea brewing. Or maybe you’ve already launched your small business. In either case, at some point, you’ll probably need an extra influx of cash. Of course in those instances, you can consider the typical avenues, like applying for a loan through a bank or credit union, or you can get a little creative to drum up those extra funds. Here are some lesser-used options to consider.
If the thought of taking out a loan buried with interest and then being tied to it forever (or what feels like forever) makes you a little nervous, you can always bootstrap. This is basically a self-financing method where you pool together available funds from your savings account, personal funds, credit card, home equity, etc. In most cases these funds equal enough to give most businesses owners the extra stash of cash they’re in need of—minus the interest.
If you’re looking to get more than just the few grand you’ll probably gather from bootstrapping, you might consider angel investors. These are business professionals who have excess cash they wish to invest. In most cases, angel investors are a good option if you’re looking for anywhere from $10,000 to a few million. A few places to search for these investors are AngelList and Angel Capital Association, both of which help connect entrepreneurs with willing investors.
If you’re passionate and skilled enough to promote your business idea in a way that persuades people to put their dollars behind you, try crowdfunding. With no interest, loan term or strings attached, crowdfunding is an increasingly popular way to find the extra injection of cash your business needs. Sites like Kickstarter and Indiegogo are known to have given many entrepreneurs the jumpstart they needed.
If none of these options sound right for you, consider talking to a banker or lender about other alternatives available for your particular situation and business.