How to get business financing and help:

Having sufficient financing to see a new business through the crucial first year is often the difference between whether a new survives or folds.   To make sure that your new business will survive it is essential that you prepare a thorough Business Plan.   Even if you are not applying for loans or grants, the Business Plan is the only way you can be sure that you know and will be able to meet your financing needs while your business builds strength.

Once you know how much you will need to start and run your business until it is self-supporting, look at where the necessary funds will come from.   Most new small businesses are financed through the owner's savings as well as loans or investment from family and friends.   There are, however, several government programs available to help small-business men and women start a business.

Financing sources:

Personal sources of financing:

Loans/Investments from family and friends:

No business is worth destroying your relationships with your family and friends.   When you consider asking a family member or friend for a loan or investment in your new business, keep their needs and feeling in mind.   Don't be offended if they will not invest in your business.   There can be lots of reasons, many of which they may not want to tell you.   They may be struggling, need their money for something in their lives or even just be afraid of losing their money.   It's natural for people to be afraid that a new business will not succeed.   It's not a judgment on you or your business plan, it's just the way that most people think.   If they are willing to invest, make sure that you do the things that will make them feel protected.

Bank Business Loans:

Unless you have a well established relationship with a bank and have considerable collateral, you are not likely to get a bank to give you a "business loan" for a new business other than an SBA loan.   Bankers are fond of saying that they'll lend you as much money as you have.   The do not like to take risks.

If you think that you have a banker who is willing to work with you, make sure that you have a very convincing Business Plan before approaching the bank.   Your chances will still be much better if you apply for a SBA loan.

Government Loans and Grants: