Because alternative financing takes so many forms, it can unlock a variety of opportunities for entrepreneurs. In this article, you’ll learn about several ways entrepreneurs have found success by working with alternative lenders.
Fledgling businesses face too many potential costs to cover in one article. But alternative financing is a great way to cover those costs, especially given that traditional banks sometimes balk at working with new, unproven entrepreneurs.
Jumping on Opportunities
Alternative financing is a great tool when entrepreneurs can’t afford to miss an opportunity. For instance, if a must-have piece of equipment goes on sale, a quickly processed equipment loan can help you seal the deal, or when a vendor offers a discount for bulk purchases, you may pull from a line of credit to take advantage.
Some business owners take on partners or seek investors to raise capital, but that often requires surrendering a share of control over the company. Many entrepreneurs are understandably hesitant to dilute their ownership of their business. Alternative financing methods may let you raise funds without losing ownership of your business.
Expansion is exciting for any entrepreneur: It signals that your business has been strong enough to gain a foothold and move beyond that initial success. But expansion also costs money, which is where alternative financing comes in. To give just one example: If your expansion goal is to open a new location, many alternative lenders can link you with commercial real estate funding.
Seasonal and Emergency Funding
Alternative financing often provides short-term cash injections, which are especially handy for businesses dealing with seasonal income droughts or emergency cash flow issues. Invoice factoring is one example of a short-term financing method. Business lines of credit serve much the same purpose by letting companies keep an always-available pool of cash on hand.
Interesting in learning what doors new funding sources can open? Talk to GM Capital Group today.