Whether you’re setting up a new business or planning to expand in 2017, there are various options to explore when it comes to business growth funding. Gone are the days where you had to beg your local bank for a traditional business loan with no proof of revenue. There are many different alternative finance options available to entrepreneurs and business owners to make their dreams become reality.
From a government backed loan to angel investors, take time to research the best possible funding path for the year ahead. Here are some lending solutions which are trending at the moment, offering legitimate ways to kick-start your business.
The growth of crowdfunding has led to countless web platforms being set up which allows anybody to set up a product or business idea. From Kickstarter to Crowdcube, people can generally invest anything from £5 to £500,000 to ensure good ideas are brought to life. With this type of funding bear in mind that high level investors may wish to be shareholders and you could end up dividing future profits hundreds of ways. Also, if you don’t reach your funding target you get absolutely nothing at all, which is a huge disadvantage.
Some entrepreneurs may be eligible for a government backed loan which offers very low interest rates. However, there is a strict criteria to meet and lots of national competition for these loans so they are pretty hard to secure.
Individuals which are wealthy and interested enough to invest in your business must be sent from Heaven! You can meet angel investors independently on Linked In, or use an online platform to be introduced. They can invest large amounts individually or act as a group to invest in one particular business.
Peer to Peer Lending
This is a type of business loan which is offered from an individual rather than a financial institution. The terms are often more flexible, sometimes the loans don’t need to be secured. To obtain this type of peer to peer funding you often need the contacts of a broker who can match peers with businesses requiring funding.
Pension Led Borrowing
Did you know that if you’ve built up an impressive pension pot, you could use this to fund your business? Even if you don’t have access to it, you can secure a loan by using your pension as an asset.