It’s usually fairly difficult to get approved for a business loan when you don’t have any money in the bank. This is fairly ironic of course, because it means that you pretty much have to already have some money in order to get approved for a loan that would provide you with more money.
Irony aside, there are some things you can do to secure business financing without having a strong bank account.
Business credit cards
Some of your business expenses can be very large, for instance rent and payroll, and these will require some hefty funds in order to be satisfied. Even these types of expenses can be managed with a business credit card, and it will have the added effect of improving your credit score when you make all these payments on time. The creditworthiness of your business is one of the most crucial factors in obtaining business financing, so using a business credit card can be very helpful.
Equipment financing
Equipment financing is very much like a business loan which requires no collateral, because in this case the equipment itself serves as collateral. You’ll be able to obtain an equipment loan based on your time in business, your creditworthiness, and and the degree of fit for the equipment in your overall business plan. It won’t really be necessary to demonstrate strong positive cash flow to secure this kind of business financing.
Invoice financing
The beauty of invoice financing is that when you have a high volume of unpaid invoices, that’s almost as good as money in the bank, except for the fact that you don’t yet have that money. However, there are plenty of alternative lenders who will be willing to purchase those invoices from you, in exchange for upfront cash which you can use to keep your business running smoothly, and possibly to help your business grow.
Does your new business need startup capital?
If all you need to get your business off the ground is startup capital, we may be able to help. Contact us at Avery James, and we’ll be glad to consider some options with you for providing the needed startup funding, so you can launch your new business.
