Startup companies are having the worst time finding legitimate funding. While some believe that the internet (and their Facebook friends) are their best bet, others follow more traditional roads. Funding for businesses these days is tough to find, whether you are a big, time-tested business or a newbie on the scene. Below are some of the best ways to gain cash flow for your startup business.
Cash Advance: A cash advance may sound like a loan, but it isn’t. Offered by merchant account providers, this method is a “buy in” to your future sales. You are given a sum, which is deposited into your merchant account, and payments are taken from your merchant account. But payments are not taken in lump-sums, but rather in small percentages with each credit card sale. So, if you make three credit card sales on Monday, a certain percentage of those sales will be taken from those sales. If you make zero credit card sales on Tuesday, nothing will be taken. This evens the field, so you are not struggling to pay back funds when you are not bringing in anything to maintain your business.
Crownfunding: Crowdfunding is where your Facebook, Instagram, and Twitter friends come in. With these websites, you (or someone else) places a fundraiser, stating why you need these funds, as well as how much you want to raise. Remember that these websites take a percentage of what is raised (between 10% and 30%) so be sure to read the fine print and add accordingly. These funds do not have to be repaid, but there isn’t a guarantee that they will be raised. Some websites also make it mandatory for you to give something away for a certain amount of funding, so be sure that you can afford to do so if it is specified.
Grants: Grants are under-utilized by many, and there are many reasons why. Most grants are based upon a demographic, i.e. race, sex, or area that you live in. This can limit many from taking advantage of their benefits, but you should research them nevertheless. These do not have to be repaid, but they are government funds – which scares some from looking in the first place.