Funding Sources
Top Sources for Business Funding
Finding the right funding for your business is key to growth and stability. Here are some of the most common financing options available today:
1. Business Credit Cards & Charge Cards
A quick and flexible way to access cash for any business need. Many merchants offer individual business credit cards with limits of $10,000 or more.
2. Angel Investors
Each year, over 30,000 small businesses receive funding from 250,000+ active angel investors. These investors are ideal when banks won’t approve you or when you need substantial capital. Try sites like Angel Investment Network or Funded.com to connect with investors.
3. Asset-Based Funding
If your business has collateral (such as accounts receivable, inventory, equipment, purchase orders, or real estate), you can leverage those assets for funding—even with less-than-perfect credit.
4. Bank Loans
Traditional bank loans are still available, but approval has become more challenging. Consider community banks or credit unions for SBA-backed loans, which have higher approval rates than conventional loans.
5. Equipment Leasing & Financing
If you need expensive equipment, leasing allows you to spread out payments over time. Some lenders even allow you to borrow against equipment you already own.
6. Factoring (Invoice Financing)
Businesses with large accounts receivables can sell invoices to a factoring company for immediate cash—sometimes up to $25 million in funding within 24-48 hours. This method does not depend on your personal credit.
7. Grants
Government grants provide funding that doesn’t need to be repaid. Explore options at Grants.gov and GrantWatch, as well as state and city resources.
8. Business Lines of Credit
A flexible, revolving source of capital similar to a credit card but with lower interest rates and higher limits (up to $150,000+). Funds can be accessed via checks or debit cards.
9. Merchant Cash Advances & Merchant Credit Lines
Businesses that process credit card transactions can get cash advances against future sales. Funds can be accessed via debit card for convenience.
10. Microfinance Loans
Designed for small businesses that need smaller amounts ($500 – $35,000). Many entrepreneurs secure multiple microloans rather than one large loan due to easier approval requirements.
11. SBA-Backed Loans
A top choice for small business financing, SBA guarantees up to 80% of the loan amount, reducing risk for lenders and increasing approval odds.
12. Venture Capital
For businesses seeking high funding amounts and willing to give up equity, venture capital can be an attractive option. Check NVCA.org for venture capital firms.
Final Thoughts
With so many funding options available, understanding your needs will help you choose the best path. Whether you need quick cash, long-term financing, or investor funding, there’s a solution to fit your business.
