All posts by Mariela Merino

As you scale and encounter new milestones and obstacles in your business, you will be faced the question of how to finance and plan for that growth. There are many options for financing but one of the most common choices is venture debt.

If you own a small business or want to start one, you might have trouble getting started because competition is tough. One way that smaller b2b businesses compete is by offering great credit terms to their customers such as net-30, net-60, and beyond. Small businesses need to accept the terms in order to maintain large accounts and clients.

Cash is the lifeline of every business and if you run out of it then your business can fail. Regardless of how many sales your business makes, if you do not have enough cash you will not be able to pay your bills and keep the business open.

Starting a business is not easy especially for those who still have a huge student loan debt, it might seem nearly impossible. Over the last few years, student debt has risen and is the largest single debt source among those that are 40 or under.

Traditionally, women are paid less than men but also women entrepreneurs often times have difficulty finding funding for their startup business. Women only see about 80 to 85 percent of approvals for a loan and only earn 7 percent of venture capital investments overall.       

Companies that seek financing to maintain and grow their business will look to traditional unsecured bank loans first because that is the more budget friendly form of borrowing available. However, many small businesses are growing fast, do not have a lengthy track record, or do not have a sufficiently high credit rating.

Congratulations! You have been approved for funding. So, what is next? You might have an overwhelming desire to spend it on whatever you want but it is important that you are responsible with your money and following a spending plan that you laid out in your business plan if your business is to survive its critical early years.

When you apply for a business loan at a large bank, often times small businesses get declined. Thousands of requests for business loans are declined every weekday in the United States. The odds of a startup business getting a loan from a large bank is not very favorable. This because large banks are mostly focused on sourcing and scaling loans over millions of dollars, cross-selling products to their customers, and driving down costs through standardized operating procedures and technology. The good news though is that there are community lenders available to help small businesses.

It is a lot of hard work to secure venture capital funding and there are several reasons why you might want to avoid it. If your market is big enough that you can generate a ten-fold increase in investment within a decade, then you are a good candidate for venture capital funding. Start looking for funding elsewhere otherwise.

Financial contingency planning is a must for businesses no matter what stage they are in. If you are pre launching or have been in the market recently, a contingency plan might not be the first thing on your mind. However, it is important that you think about unexpected situations that can occur because it can interrupt the launch of a new business or disrupt normal operations. If you do not have a contingency plan, the unforeseen events can be harmful to the health of your business, potentially leading to insolvency before a startup is even off the ground.