Have you started a successful business that’s ready to grow? In honour of Small Business Month, each week in October we’ll be discussing ideas on how you can take your business to the next level.
Your business is doing well. All that hard work you’ve put into your venture is finally paying off. Before you even put your feet up for a moment to enjoy your success, you’re probably thinking: “how can I take my business to the next level?”
Without a doubt, it takes hard work, passion and perseverance. But it also takes money – either in the form of debt financing or equity financing. Beyond traditional business financing methods like borrowing from a bank or using your own funds, there are many other ways to find the money you need to expand your operations. Here are five options you may not have thought of.
Business financing options
Small business loans through traditional banks often have a notoriously lengthy and complicated application process, not to mention high rates of rejection. If you’re looking for an alternative, online lenders like Lendified have entered the Canadian marketplace bringing fast, simple and affordable online lending to entrepreneurs and small business owners.
The federal government, your local provincial government, as well as the Business Development Bank of Canada (BDC) offer a variety of financing solutions for small businesses, including grants, assistance programs and loans. While finding and applying for government grants or loans can be a time-consuming, complex process, it might end up being time well spent for your business.
Angel investors are usually wealthy individuals who are actively on the lookout for businesses to invest in. What do they get in return? Typically, some share of equity in your company. Some “angels” may want to be involved in the company they invest in, while others take a more hands-off approach. Regardless of their style, they’ll want to see a detailed business plan and they’ll expect a high return on their investment. They can be hard to locate, but you can try finding angel investors by searching online or talking to your local chamber of commerce.
Friends and family
Although you may be of the opinion that money does not mix well with family and friends, many small business owners ask the people closest to them to invest in their business. Your friends and family are more likely than anyone else to believe in the vision you have for your business, and you could potentially offer them a solid return on their investment. If you go this route, be smart about it to avoid damaging a relationship: let them know what your business plan is, put the financing agreement in writing, and make sure they know there’s no guarantee of a return on their investment.
Crowdfunding is a relatively new concept, but it’s gained a lot of popularity over the last few years. It allows you to focus on raising smaller amounts of money from a large amount of people online through websites like Indiegogo, GoFundMe and Kickstarter. You can ask people to donate their money, or you can offer supporters rewards or incentives. Once you start your crowdfunding campaign, you should be ready to spread the word through your personal network, social media, email, and any other channel at your disposal.
Remember that anyone you reach out to for business financing may want peace of mind knowing that your business is insured. Proving you’re insured can help you earn trust, enhance your reputation, and grow your business, so make sure your business is protected with the right coverage.
This blog is provided for information only and is not a substitute for professional advice. We make no representations or warranties regarding the accuracy or completeness of the information and will not be responsible for any loss arising out of reliance on the information.