Five Common Ways To Fund A Small Business Beyond Personal Savings
Wednesday, September 30, 2020
One of the most cliched statements in starting a small business is that “it takes money to make money”... but it is often true. Many businesses need an infusion of cash to buy essential components of their operations. For a pizzeria, that could be an industrial oven, and for a yard care business, that could be a commercial lawn mower.
A common funding practice many new business owners take is to use personal savings and start small by reinvesting profits into the business. This approach, known as bootstrapping, seems rooted in common sense, but can be restrictive to your business’ growth and personal finances. If your business needs a large infusion of capital, you don’t necessarily have to go it alone and shouldn’t if it jeopardizes your financial security.
There are a number of funding sources available to new and established businesses beyond your personal savings. Here are the five most common.