4 Logical Ways to Finance Your Startup

4 Logical Ways to Finance Your Startup

With the booming success of startups such as Uber and Airbnb, more and more budding entrepreneurs are seeking to make their dreams a reality through the online marketplace. While the Internet is making it easier than ever to build new businesses, however, it also gives rise to more competition. It can be difficult for new ventures to gain a foothold in their niche without a little bit of help.

More and more budding entrepreneurs are seeking ways to cover the costs of initial business operations by looking into both traditional and new age financing options. Even if you’re operating out of your parent’s garage, there are plenty of ways to find the capital that you need to bring your ideas to life without emptying out your savings account.

Friends and Family

From Trump to the Koch Brothers, many self-made billionaires got their start through a family loan. Friends, family members, and other loved ones who believe in you or your idea may be willing to invest in your business. This type of bridge loan can help to keep a business afloat until it has the numbers to attract investors on a larger scale.

Bank Loans

While banks might be the first thing that comes to mind when looking for a business loan, they are often the last place that startups should go looking for financing. Many banks are unwilling to lend significant sums to new businesses, especially those without a proven history of success. If you have trouble securing a loan at a federal bank, you may have more success trying a community bank or credit union.

Credit Lines

Credit cards offer immediate access to the funds a new company needs, including cash advances. They also make it easy to track spending in the early stages of business development. When using a credit card, however, consider whether or not you can reliably pay your balance off each month. Even though credit lines offer the benefit of immediate cash, they often have high interest rates.


While still relatively new, crowdfunding has become a popular way for startups to raise the money that they need to get a product or service out the door. Sites such as Crowdfunder and Kickstarter help to level the playing field, giving smaller companies the chance to compete with bigger, better-financed corporations. These sites put funding in the hands of the consumer, instead of forcing small businesses to rely on professional investors and brokers.


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