For a few thousand dollars, consider using your credit cards or obtaining a new credit card account to fund the business. Use that card only for your business and you’ll have a way to keep track of your expenses as well.

Another avenue for finding money for starting a business is to use your home equity loan, especially if you need, say $5,000 to $10,000. The interest rate on home equity loans are usually much lower than credit cards, but be careful. If you can’t pay the money back or make the additional monthly payments you could lose your home.

Look towards the heavens if you need an angel investor. Angel investors are private wealthy individuals who invest from $50,000 to $100,000. Most of the time the company they invest in is high tech and looking at a fast growth period. Angel investors will become involved in the day-to-day management of your company so keep that in mind.

Venture capital receives a lot of press and does invest billions of dollars, but, and it’s a huge but, only about 20% of the companies receiving venture capital are start ups. The average investment by a venture capital firm is in the millions, so it’s not appropriate for small businesses. Less than 1% of companies seeking venture capital successfully obtain it, that’s only about 4000 companies per year.

You might consider alternative sources of financing such as obtaining inventory through consignment, royalty financing, trade and barter or purchase order financing.

Many small businesses think that a grant from the government will be their saving grace. Unfortunately there are very few government grants available for businesses. Those that are awarded, are done on a competitive basis to established companies usually in the medical or technical fields.

However, grants or very low cost loans, are sometimes available through cities and states for the purposes of urban redevelopment, in blighted neighbor hoods or to increase employment.

Money for starting a business can be found in a number of places and should be one of the first tasks an entrepreneur should complete.

Author: Dee Power
Article Source: EzineArticles.com
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