Whether you’re starting up a new business or have a business that’s going through a rough spot, you’re bound to, at some point, find yourself in a spot where you need to raise funds for your business quickly. Fortunately, there are lots of different options and strategies you can utilize to raise money and get your business off the ground or back on track, whichever the case may be.
Unfortunately, when your business is in a troubled spot or hasn’t even gotten started yet, most standard lending options, such as banks and investors, are not going to be willing to help you out. If, however, you have some assets working for you, you may want to consider selling them off and using the money earned toward your business.
Assets can be all kinds of things, such as investments, real estate, stocks, or anything in between. Basically, if it can bring you money, it’s an asset. However, don’t just start selling off your assets. Talk with a financial adviser to determine which assets are the best choice to part with and which ones will actually help you to raise the funds you are in need of.
Help from Community Development Financial Institutions
Before you consider community development financial institutions (CDFIs) as an option, make sure you qualify. This financing option is only available to businesses that are located in distressed areas. If your business does, in fact, qualify, you can see out a CDFI that is certified by the United States Treasury Department and apply for financing.
Financing is typically given to businesses that can prove that they would help their surrounding area in some way, such as by providing jobs to the community. If you think your business might be eligible, it’s definitely worth a shot to apply for financing.
Another option you may also wish to consider is a microloan. Microloans are offered through the title loan companies, whose goal it is to make business loans available to a wider range of entrepreneurs. The loans are not very large in nature, hence the “micro” title, but they can really help out a business that needs a little boost to get started or help to get out of trouble. The highest loan amount is $50,000, and you can apply through an intermediary in your area. The Small Business Administration lists all verified intermediaries on its website, as well as information on how to apply and tips for getting your loan request approved.
Finally, if you have assets but don’t like the idea of completely selling them off, you may want to consider asset-based lending. Asset-based loans are based on your business assets, like your accounts receivable, or other assets you may have. The assets serve as the collateral, and you do stand to lose them if you don’t raise the money to make your payments on time. However, they are a good way to get over a brief hump in your normal business proceedings.
These are just a few of many options to quickly raise funds for your business. There are others out there, so if none of these are the right fit for you, consult with your financial adviser to learn about other choices that could work for you.