An essential part of any business plan is start-up capital. Of course, sometimes the required amount is already deposited in the bank account, but in most cases additional sources of funding are required.
Loans
The most popular option is to take a business loan from a bank. Almost every bank has special programs for lending to small and medium-sized businesses. True, for a case that is just opening, the stakes are quite high. For example, for individual entrepreneurs and small businesses, they are in the range of 20-26% per annum.
The overpayment really turns out to be rather big. However, you get reliable funds, which are secured by an agreement with the bank. You do not have any additional obligations to the lender, and you are also insured against renegotiation of the terms of the contract.
Despite all these conditions, getting money in this way can be problematic. You will need to prove to the bank that your company will definitely shoot, and this is not so easy. It is necessary to think over all the details, even the smallest.
Moreover, few projects are capable of starting to make a profit from the first days. As a rule, it takes several months to build up a client base, organize all the processes, and so on. In addition, you may be required to leave a deposit: an apartment, a car, a land plot or some other valuable asset.
An alternative to a business loan is a consumer loan. However, it will suit you only for small projects, since it is almost impossible to get a large amount here. One of the advantages is that you do not have to provide a business plan and go through a very lengthy application review procedure.
Alternative options
Borrow money from friends or family. It is beneficial, firstly, because you will be able to agree on mutually beneficial terms, and secondly, because you do not have to leave a deposit or pay high interest. However, it is very difficult to find a friend with big money, and he can easily refuse you. Plus, if you fail, your relationship with that person can seriously deteriorate.
Seek help from a union of entrepreneurs. As a rule, such organizations are created by people who have already tasted all the complexities of business undertakings. It is easier to cope with difficulties together. In addition, it is possible to regulate individual areas if we act together. They also provide funds for business development for the aspiring entrepreneur.
You can contact the all-Russian or regional union. The largest such association is the Federal Fund for Small Business Support.
