Finding money can be one of the biggest hurdles for a small business owner. Whether you desire to open a chain of restaurants or an Internet-only business, capital is required to fund your dreams. Here we will explore the different types of funding available to you:
Debt financing includes any money you will pay back. It does not require you to give up equity in your company and can be a good choice for entrepreneurs who have not been able to attract the attention of investors. This type of financing usually requires personal collateral and will require you to pay interest.
Equity financing requires you to give up a portion of your ownership to investors in exchange for their money.
Other types of funding:
As you can see, there are a variety of ways to get financing for your start-up. An accountant or financial manager can help you decide which type of funding would be best for you. For more information on business financing, including sample promissory notes that can be used for family and friend loans, visit SCORE: http://www.score.org.
This article, by Dequiana Brooks, was originally published in Gemini Magazine.