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Starting a new business requires money, and it’s difficult to get the wheels in motion when you don’t have a lot of money. Getting a loan can require a lot of footwork and effort to obtain, adding more stress to your efforts to start your business.
The good news is, you’re not restricted to loans and credit cards to fund your startup. The federal government, non-profits, and corporations all offer alternative types of lending to get you going.
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Small Business Grants
A small business grant is a source of funding that you apply for and don’t have to pay back if you receive the award. The federal government, non-profit foundations, and corporations of all sizes and types offer small business grants. Grants are available in a wide range of values and can be as little as a few hundred dollars to thousands of dollars.
In order to receive a grant, you have to apply and make a case for why you need the funding. If you’re uncertain as to how to write a grant, you can hire someone to write your application on your behalf.
Winning the grant provides you with funding that’s free from repayment. You can use the funds to get your business started by paying for what you need without straining your budget.
Government Lending Programs
The federal government offers loan programs for startups and small businesses through the Small Business Administration (SBA) and partnered banks. That is, you can’t go to the SBA to ask for a loan as it doesn’t do direct lending. Instead, you go to a bank that’s authorized to issue SBA-backed loans.
An SBA loan typically features favorable repayment terms and is available in amounts that reach millions of dollars in a single loan. This may seem like a lot of money for a small business, but the SBA defines a small business by its annual revenues and employee numbers. Working with an SBA loan specialist helps you understand more about how your business is classified and the types of loans that are available to your business.
Corporate Sponsorships
Corporations give back to their local communities through various methods of financial support. One of those methods is corporate sponsorship which is a type of partnership with the corporation and the small business. The small business owner agrees to promote the corporation in a defined manner, and the corporation gives money to the small business in return. Discover how corporate sponsorships benefit small businesses and local communities through strategic partnerships at Bitmoji.org.
The corporation stipulates the terms of the sponsorship in order for the small business to receive funding. The terms vary, which means you should read up on the offer before you decide to apply for the sponsorship. Provided your business is in alignment with the corporation’s expectations and you know you can execute the agreement, corporate sponsorship can be very favorable for your business.
It’s a good idea to explore all your avenues for funding your new business. Having a mix of funds that include ones you have to repay, ones you don’t, and ones that have favorable terms all help you get your business going. Meanwhile, you get to move forward with your plans and run the business you’ve been dreaming about.
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