financing of small businesses

BUS 415

Small Business Management

Teacher: Mehmet Ali Gurol

Presenter:Dilara Rasulova

Topic: Financing of small

businesses

Small business financing refers to the means by which an aspiring or current

business owner:• obtains money to start a new small

business• bring money into an existing small

business to finance current future business activity.

• purchase an existing small business.

There are many ways to finance a new or existing business, each of which

features its own benefits and limitations.

15 Creative Ways to Finance Your Small Business

Selling your product

Selling your products is an often-overlooked way of raising the money needed for financing your business, but it can be highly effective.

Friends and family

Borrowing from friends and family

presents an interesting

alternative to traditional forms of financing, and can have some unique

advantages.

Having another business

New business owners can also look to double

dip as a means of funding their startups.

Home equity loan

A home equity loan is based on the equity the person seeking a business loan has in his or her home. For those who have equity — the home's value

minus what you owe — in their home, this is a great option for financing a

small business because they generally offer interest rates that are both

flexible and lower than traditional commercial rates.

Selling assets

Credit Cards

Other people looking for additional financing for their small business should look

no further than their wallets: Business credit

cards are among the most readily available ways to

finance a business

Credit-card-balance transfers

Balance transfers are one way to help card holders pay off credit card debt. Credit cards are a big business today, with many companies making a fortune off finance charges.

Angel investors

Those looking to finance their business can always look to an angel — angel investor, that is. Angel investors have been responsible for helping to start up companies generally early stages of growth.

Angel investors can help nascent businesses by serving as advisers.

Winning a contest

Businesses can benefit from a bit of luck.

"This advantage give them the opportunity to increase their production and get into bigger players.

Venture capitalists

While venture capitalists are synonymous with the dot-com bubble of

the late 1990s and early 2000s, the truth is that they

may be a great source of capital if your business falls

into certain categories.

For small businesses that are beyond the startup phase and already have revenues

coming in, a venture-capital investment may be appropriate.

For a fast-growth company with an exit strategy already in place, venture capitalists

present a great way to quickly gain up to tens of millions of dollars that can be used to invest,

network and grow their company quickly.

Real estate

Business owners with a Midas touch in real estate

can also put that skill to good use in financing

business ventures.

Strategic investors

"Strategic investing is more for a large company that identifies

promising technologies. Using strategic investing must also

think about the restrictions the investing companies may place on them, as they can prevent dealing with any competitors and possibly

even cancel the business relationship at any time.

Renting an apartment

Cutting out liabilities is another creative way for new business owners to

fund their startups.

Crowdfunding

Sometimes, there really is wisdom in crowds, especially if you are looking to start a new business.

There are numerous advantages to crowdfunding as a

means of financing.

Alternatives of small business financing options:

• Debt financing• Traditional small business financing options• Equity financing• Alternative small business financing options • Rollover Retirement Funds to Start a

business or finance an existing business• New sources of debt and Equity Financing• References

THANKS FOR YOUR ATTENTION