What are the Alternatives for Financing a Business?

Here are 9 alternatives best suited to finance a startup.

While there are numerous alternatives for funding start up businesses, some of them may not be practical for pure early stage start-ups until the company gets further along in its operations. Here is a list of the types of options available for start up funding:

1. Self financing from the founder's cash assets
2. Investment from family and friends
3. Investment from angel investors (professional investors who invest in companies)
4. Borrowing money from a bank or other lender
5. Borrowing under an SBA loan
6. Lease financing, in order to acquire equipment such as computers and office equipment
7. Venture capital financing (from venture capital funds)
8. Financing from strategic partners
9. Financing from potential customers

Of course, there's always "bootstrapping," or funding your startup yourself! Yes, it's possible -- read our article "Starting a New Business with Bootstrap Funding" for some ideas -- as well as an important warning!

If you decide to apply for a loan from the U.S. Small Business Administration (SBA), it might be worth your while to take a look at The AllBusiness.com Practical Guide to SBA Loans, a 56-page kit with background, sample forms, and full instructions.

Find additional information on small business loans and equity funding sources for your small business at AllBusiness.com.

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