Small Business Funding

Written by Josh Dodes
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When it comes to small business funding, there are two principal types of lenders. For decades, of course, traditional lenders have sought, with varying degrees of success, to shoehorn traditional big business lending structures into a model that more carefully approximates the needs of smaller business owners. However, in the last few years, a second type of model--one specifically designed to meet those smaller business owners' needs--has finally emerged.

The best of these alternative lenders distinguish themselves from their traditional counterparts in a number of important ways. Perhaps most importantly, these lenders view small business funding as a genuine investment in your business and success. By tying repayment not to a fixed monthly fee, but to a set percentage of your future sales, these firms ensure both that they are on your side and that you will never have to pay more than you can afford.

Other Advantages of Alternative Small Business Funding

Another major advantage of alternative small business funding resources is that their qualifying criteria are far less stringent. Whereas traditional bank loans are typically reserved solely for firms that can offer significant collateral, these innovative new loans are accessible to any firm that has been in business for a year and that has shown a reasonable monthly minimum in credit card sales. The best such firms like to say that they work less hard to screen businesses out than they do to screen businesses in.

With unpredictability perhaps the only predictable quality of the small business world, why take chances with a loan that you might not be able to repay at the same rate every month? Now that you can borrow money from an alternative lending resource that more clearly understands your specific needs and capacities, there is no reason to risk burying yourself under crushing loan obligations. Take steps to begin investigating your full range of financing options today, and you may well be glad that you did so for years to come.

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