As a business owner, you often need money – for inventory, payroll and the like – to make money. Right now, unfortunately, many banks aren’t as interested in readily offering loans to smaller companies. Luckily there’s federal help, as well as an array of innovative new ways to get funding for your business.
Alternative Lending for B2Bs
If you’re a B2B business looking for an honest, transparent lender to help you with funding while you’re waiting for your clients to pay for their invoices, you will be surprised by how simple and helpful an alternative lender can be.
At Bluevine, all of our customers are B2B companies. They often times have lumpy cash flow or long payment cycles. Or, because of their rapid growth, they face a strain on the cash flow. That’s where Bluevine comes in. Bluevine gives B2B companies an advance on their current invoices, in as fast as 24 hours for new customers or 15 minutes for repeat customers.
If you’re a B2B company looking for a quick, practical and proven way to get money while you wait for your clients to pay you, Bluevine may be the right fit for you. You may have heard of invoice factoring, a transaction where a business sells its accounts receivable to a third party. Bluevine is a smarter, kinder, gentler alternative to invoice factoring. Unlike invoice factors, Bluevine is paperless and integrated with QuickBooks, Xero, and Freshbooks. Thus we can give small businesses a response within 24 hours. Bluevine also never contacts your clients. Instead, you retain control of your entire relationship with your client. You can factor any invoice you choose and you’ll never have to commit to long-term contracts or face termination fees. Our biggest source of customer retention is a great product and customer service.
Our customers run the gamut. Some are new business owners with rapidly growing companies and/or less than perfect credit. These companies often can face a strain on their cash flow because of their rapid growth. Despite their robust growth and good credit, banks may be unwilling to lend to them due to their lack of history. Sometimes, they have lower credit due to the many purchases and credit lines that new business owners need to take out in order to finance their growing business). Regardless, their options are limited.
Others are very successful, established business owners who don’t have time to wait for a bank to process their loan requests. These types of customers don’t want to take out back loans because they don’t want to go through the onerous and time-consuming loan process. To them, time is money. They’d rather work with Bluevine and receive a response within 24 hours than spend countless hours on paperwork, only to get declined by their banks. You can learn how much you can get for your for your invoices in seconds using Bluevine’s simple calculator, or by calling 1-888-452-7805.
Crowdfunding for Consumer Products
Crowdfunding has become a popular way for unknown companies to introduce consumer goods to a large market very quickly. By using crowdfunding sites – primarily Kickstarter or Indiegogo – that allow the public to essentially vote with dollars by funding concepts that they’d like to see made (or pre-ordering), business owners can test the market to see if there’s a market for their product. For Kickstarter in particular, a great video is very important. The video should be somewhat professional and should clearly illustrate the benefits of using the product. It should be well lit and edited to make the product stand out. Don’t focus too much on making it too artsy, or people may be confused about your product.
Once you meet your monetary online goal and get enough people to order your product, be sure that you ship out the product on time and as promised. To learn more, check out these tips on crowdfunding.
Small Business Administration (SBA) Loans
SBA loans can help business owners who can meet all of the standards in the Application Checklist. Although it may be an extensive list of records, it can be beneficial for businesses that don’t have many other options. Such loans come with an SBA loan guarantee which promises the lender that the SBA will repay a part of the loan, should a business owner default on a loan repayment.
There are also various SBA lending programs that help business owners in an array of financial hardships. For example, the SBA offers Disaster Loans, which provide financial assistance to victims of disasters and those in disaster areas.
If you’ve been affected by financial losses due to environmental damage, you may be eligible for the Economic Injury Loans for small businesses, small agricultural cooperatives, and nonprofit organizations. It’s for businesses recovering from loss as a result of a physical disaster or agricultural production disaster.
There are also loans available for members of the military. Under the Military Reservist Economic Injury Disaster Loan, business owners who lost money or potential business because they were “called-up” for active duty as a military reservist are eligible for compensation.
While you may not be eligible for all of these loans, there’s a multitude of creative financing out there for motivated small business and startup owners. The main barrier you may need to overcome with government-assisted or bank loans is paperwork in many cases. But depending on your situation, those may be the right options for you.
All of these options have their pros and cons, and different criteria. You’re in the best position to decide which is the best option for you. Do your research before you take the plunge, and remember to weigh the value of your time and the likelihood of approval before making a decision. To learn more about small business and startup financing growth hacks, check out our resources on Bluevine.com.