It is important to make sure that you are knowledgeable about the different options available to finance your business:

• Term Loans: Gives your company the full amount of the loan up front, and the money is repaid in pre-arranged monthly installments.
• Lines of Credit: Gives businesses the option of borrowing as much money as they need, whenever they need it, up to a pre-arranged maximum amount.
• Business Credit Cards: A convenient means of financing for many businesses.
• SBA Loans: Loans that are either guaranteed by or are financed, in part, by the U.S. Small Business Administration.
• Government Loan Programs: Government assistance can make the difference a small business needs to start or expand operations.
• Leasing: Equipment Financing and Leasing allow businesses to obtain business equipment, including computers, vehicles, tools, machinery, etc.
• Asset-based financing and factoring: Requires that an enterprise use its hard assets for collateral to acquire a loan to finance operations. Factoring means that a lender pays your business money your customers owe you, in exchange for a percentage of these funds.
• Credit Card Receivables: Companies buy a portion of your business’ future credit card sales in exchange for an up-front cash purchase price.
• Commercial real estate loans: For the purchase, new construction or refinancing of commercial, industrial or investment property. Generally available for up to 75% of the property value and can be extended for up to 25 years.
• Selling consumer debt: Consumer receivables are unpaid debts from individuals. If you have extended revolving lines of credit, you may be able to sell the unpaid balances for pennies on the dollar.
• Angel Investors/ Private Investors (Next Section)
• Venture Capital (Next Section)

Raising capital is also one of the most basic and challenging aspects of all business activities. Investors require information on: Business Plan, Management Team, Track Record, Exit Strategy, etc. The following are tips on how to raise capital:

• Determine the objectives you hope to achieve by bringing partners and/ or investors into your company. Seek lenders who are knowledgeable about your enterprise.
• Plan ahead: Avoid making multiple loans to cover unforeseen events. Plan and implement a strategy for growth.
• Take advantage of market conditions in your business. Be prepared to adjust to market changes to ensure the business can survive through tough times.
• Diversify relationships with capital investors. There are many sources of capital including: individual and family investors, your supplies, private and corporate venture capitalists, institutional lenders such as banks, the Small Business Administration and other government funded entities.
• Negotiate the terms and expectations up front.

---

For more information, contact Diamond Bank’s Commercial Loan Department at 847.427.7800