Perhaps your business is sailing along smoothly and you think it is time to expand. In that case, you’ll need some extra money, but this could be a sticky point. There are several ways, though, that you can find funding to expand your business. Read on for a few ideas.
A Small Business Loan
You might think about taking out a small business loan to finance your expansion, especially if you will need a particular amount of money. You can get loans through the Small Business Administration that are specifically geared toward expansion. Whether you only need a microloan of less than $50,000 or something larger, your loan will be at least partly covered by the government if things should go wrong. You may, however, have to put up collateral, and you should carefully read and fully understand all the terms before signing on any loan.
Grants
You could also apply for a grant to fund at least part of your expansion. Again, take a look at the offerings from the Small Business Administration, especially if you are trying to build up your use of technology. You should also check with your state government and state colleges, both of which sometimes offer grants geared specifically toward expansion. Some grants may require matching funds, and you will have to present a detailed plan and solid budget for your expansion. Grants can be competitive, so even if you apply, don’t neglect other sources of funding.
Crowdfunding
If your business has a strong customer following, you might be able to engage in some crowdfunding to boost your expansion. Research this option carefully because there are several different types of crowdfunding. Some are completely donation-based. Others offer rewards of some sort, and still others provide a form of equity, giving donors/investors shares in the business. You will also have to decide on a crowdfunding platform to use. Read terms of service carefully to find out about fees, regulations and other procedures. If you decide to crowdfund, you will have to market this thoroughly so your customers know about it and contribute.
An Investment Company
Finally, you might explore investment companies or private equity firms to see if one of them would be interested in supporting your business. Companies like STORY3 Capital Partners, managed by Peter Comisar, will sometimes invest in a promising business. Do some research to find out about requirements, and then reach out if you feel your business might qualify.
Even if your first attempts at fundraising fail, don’t give up. There are plenty of options for funding your business expansion.
