Starting a business is just half the battle — growing it can be just as demanding. And while your growth strategy can change depending on your industry, something is for sure: you’ll need adequate funding. With that in mind, today we explore some ways to fund your company’s growth. Follow along to learn more!
Pull Yourself Up by Your Bootstraps
You know the old saying: “Pull yourself up by the bootstraps if you want to achieve something.”
Here, bootstrapping means working long hours, stretching a limited cash flow to its limit, and wearing many hats to maximize profitability.
While this alternative isn’t for everyone and might not be a good fit for many industries, it’s a good way to drive business growth while retaining business ownership.
Bank loans are another conventional, common-sense option to fund business growth. However, a bank loan is just out of the question for millions of business owners.
To begin with, you are often required to have a strong credit rating, be in business for a certain amount of years, and be able to meet the bank’s long laundry list of requirements.
If your credit history is far from perfect, or you’re just starting out, then chances are good that a bank loan is not in the cards for your business.
An angel investor (also known as a private investor or seed investor) is an individual who provides capital to startups or early-stage companies in exchange for ownership equity or convertible debt.
Angel investors bring not only money to the table but also their experience, knowledge, and network.
The bad news? Just like angels, angel investors can be really hard to find.
Pulling yourself up by the bootstraps is hard, bank loans are complicated to qualify for, and angel investors are difficult to come by.
If what you want is an easy, simple, and realistic financing tool to fund the growth of your business, then factoring is for you.
With receivables factoring, you sell your unpaid receivables to a third-party company known as factor. The factoring pays you immediately so you don’t have to wait 30 to 90 days for your customers to pay you, and then collects the invoice from your customers in exchange for a small fee.
It’s a simple, easy, and flexible process without the stringent requirements of bank loans. Plus, it doesn’t depend on unrealistic expectations such as pulling yourself by the bootstraps by working seven days a week, or waiting for an investor to just hand you money.
And if you choose non-recourse factoring, the factor absorbs the risk of any non-payment, so you even get protection against bad debt!
Wrapping It Up
From receivables factoring and bank loans to angel investors, there are various financing options available if you want to take your business to the next level.
And while what works best for your business depends on several variables, factoring of accounts receivable is one of the best alternatives for businesses with a large amount of unpaid invoices. Unlike other options, factoring is fast, flexible, and easy to qualify for — all in all, an effective and realistic tool to fund business growth.
To learn more about factoring, or get started with receivables factoring, contact our team today!
ACS Factors: We Turn Your Invoices Into Cash
We are a Factoring company located in Upland, California, with many clients nationwide in the distribution and logistics corridor which includes Ontario, Riverside, Fontana, Jurupa Valley, and Moreno Valley.