Raise Money to Start a Business
Raise money to start a business by using personal savings, asking friends and family for loans or applying for a bank loan through the small business association. Write a business plan before asking for money with advice from a financial consultant in this free video on business financing.
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Hello, my name is Bill Rae. I'm with AFS Financial. I've been in the business and finance field for well over 20 years, and today, we're going to talk about how to raise money to start a business. Excellent question, by the way. The obvious place to start if you're looking at creating a business is to look to see what do you have in personal savings? That would be the least expensive place to get money, obviously. Some people like to start businesses using their own personal credit cards. If you're solid on your idea and you're sure it'll work, that's a shot you can take, but be careful, though, of the finance charges on those credit cards and make sure you make the payments. If you've got a real good idea and you're absolutely certain it'll work, you can also ask around for friends, family. When it comes to friends and family, a lot of emotion gets involved here, but it is a good spot to ask for money, especially if you have a well-thought-out, structured written business plan. when you think about approaching family and friends, try not to do it on an emotional level. Why not approach them just as if you were going down the bank to apply for a business loan? Offer them some sort of equity or definitely some sort of return on their money. And by the way, there's another source of money. If you have a well-thought-out business plan, go to your local bank. Talk to them about small business loans. The SBA is out there to help you. There's all sorts of ways to raise capital to start a business, but my advice to you is before you step out, as yourself this: Have you done your homework? Do you have a written business plan? More importantly, do you really know what business you're getting into? As always, I would say seek sound, competent advisers. Give us a call or someone like us. We'll help you walk through it. My name is Bill Rae, I'm with Alumni Financial, and we're helping you build wealth.