Posts Tagged ‘working capital loan’

A topic that has come up the last week is the lack of funds for new or young small business.  Many entrepreneurs are being given so much advice in this economy that often they don’t see how to get going or get working capital for their new business.  Banks and local credit unions are not lending and to go on the internet to look for funds is often a wild proposition.  There is a way and is rather simple.  Is more like a plan.  My advice which you can say it’s based on the plan that I have formulated for my friends and clients is this:

1. Get your business registered-started.  Get your DBA, corporation and internet domain name.  You can get a DBA or “doing business as” registration for a nominal charge.  You can also incorporate, (S, C or LLC) for very cheap.  Get your business on the clock so when lenders ask for how long you have been in business you can say a date other than “Last week”.
2. Get a business checkingsavings account.  This is a minimum requirement for any business.
3. Get a Business Plan. Having one is not necessary but will help you in organizing your business and identifying your market base.
4. Set up a merchant account.  This will help you in taking credit cards as payment which will make it easy to get more business as not all people pay in cash.

After 3 months in business you can use your credit card receivables as the qualifier to get the working capital loan that you need to expand and get rolling.

Granted, the initial cost to get your business started might run you $700-1000, but that will get you going so you can get your customers which in turn will keep you alive for the initial 3 months until you can qualify for the credit card based loan.