4 Ways to Scrape Up Extra Funding for Your Business

Searching for additional funding for your business can feel like a business within itself. With so much information available, it can be overwhelmingly time-consuming to comb through it all to figure out which sources are credible and worth your time. Read on to learn four ways you can find extra funding for your business. 

1. Business Grants

Funding your business through business grants is an often-overlooked option. Grants are different from loans in that they do not have to be paid back, which can make them very appealing to some. However, applying for a grant can be a lengthy process of quantifying on paper why you are the best candidate for the grant.  In order to qualify for a grant, it’s best to hone your writing skills or hire a professional grant writer. 

It is also wise to search for grants on an ongoing basis rather than wait until you are desperate for money. Similar to school scholarships, grants come in all types and amounts, and each one is specific to the demographic it is meant for. When searching for grants, it is common to come across scams, so the best place to look for grants is on an official government website.

Resource: https://www.valuepenguin.com/small-business/small-business-grants 

2. Business Loans

Business loans can be a good source of funding for your business, but you should be careful. As a business owner, you need to know yourself well and decide if you are comfortable taking on debt that you may be personally responsible for.

One of the main reasons people apply for business loans is because they need the money to scale and have grown beyond their ability to fulfill orders. Always have your paperwork in order with your current data so that you can expedite your loan application process as soon as possible. Along with having a good credit score, you may have to meet additional requirements for having been in business for a certain length of time in addition to generating a certain level of revenue. 

Resource: https://sunwisecapital.com/bad-credit-loans/ 

3. Angel Investors

An angel investor is usually one person (as opposed to a hedge fund) who provides capital to businesses they believe in. While angel investors are wonderful to have, you cannot risk your business by depending on one. Finding an angel investor is as easy as searching the web, but the hard part is scheduling an opportunity to pitch to them and then nailing it.

Additionally, the financial blessings of angel investors often come with strings attached.  It is seldom free money. The terms of the investment vary for each situation. However, usually the investor becomes, at the very least, minimally involved in your business.

Think of an angel investor as similar to a hedge fund in the sense that you are beholden to the initially agreed-upon terms.   

Resource: https://donnagriffit.com/guides/the-ultimate-guide-on-how-to-find-an-investor-and-get-a-meeting/

Crowd-sourcing

Funding via crowd sourcing is not just for musicians and artists. Over the past decade, crowd-sourcing has become a respected avenue for acquiring business funding. Consider using government websites for crowd sourcing education in general, and then begin with Kickstarter as just one example of the format.

Resource: https://digital.gov/event/2019/04/09/federal-crowdsourcing-mobilize-citizen-scientists/ 

Now that you have a little more information about where you may be able to find additional money to fuel the needs of your growing business, go out there and get searching. 

Need more assistance setting up your new business? Consult Lum Law Group about legal complexities that might affect your business!