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How To Get Money To Start A Small Business?

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By Author: Muchlis Dj
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how to get money to start a small business? Is the number one question asked in starting a small business.There are two types to get money to start a small business: debt and equity. Consider what type is right for you.
Debt Financing is the use of borrowed money to finance a small business. Any money you borrow is considered debt financing.
Sources small business loans to get money to start your small business are many and varied: banks, savings and loans, credit unions, commercial finance companies, and the U.S. Small Business Administration (SBA) are the most common. Loans from family and friends are also considered debt financing, even when there is no interest attached.
Small business loans to get money to start your small business offer in two forms: one is secured and other one is unsecured small business loans. When no collateral is offered to the lender the loan is called as unsecured small business loans The amount which you can get under this form may be lesser as compared to secured option but it is the best way to support immediate expenses as the approvals are quite faster in absence of collateral ...
... valuation. On the other hand if the need is bigger and you need money for longer term, you can rely on a secured small business loan. These loans are easily available to borrowers with a bad credit history or poor credit score.
While considering your loan application a lender will look for your business prospects. You may need to convince the lender that your business will succeed enough to repay the loan on time (when collateral is not there). Along with such information, simply fill in the loan application form with your personal details and requirement and details about your business. The lender will review your application after which he will contact you for further assistance regarding small business loans
Equity financing is any to get money to start a small business that is based on the equity of your business. In this type of financing, the financial institution provides money in return for a share of your business's profits. This essentially means that you will be selling a portion of your company in order to receive funds.
Venture capitalist firms, business angels, and other professional equity funding firms are the standard sources for equity financing. Handled correctly, loans from friends and family could be considered a source of non-professional equity funding.
Equity financing involves stock options, and is usually a larger, longer-term investment than debt financing. Because of this, equity financing is more often considered in the growth stage of businesses.


To see more about How To Get Money to Start Business visit Moneytostartbusiness.com

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