Your startup is meant to make you money. Before it can do that, however, you have to put money into it. That’s easier said than done sometimes, especially when you have significant purchases you need to make for it. 

So what are some of your options for coming up with the funds you need?

Take Out a Business Loan

Many startup owners turn to business loans to finance their purchases. This can be a great option since it allows you to retain control over your business. Give yourself your best chance of securing the loan you need with careful planning and preparation. 

Keep in mind that both your personal and business credit score impact your loan eligibility, as does your annual revenue, how long you’ve been in business, and a collateral pledge. As with most debt, it’s best to pay your loan off as soon as you reasonably can–remember to ask if there are any prepayment penalties in the loan terms.

Apply for a Business Credit Card

What if you aren’t eligible for a business loan? Applying for a business credit card could be a viable alternative. It works very similarly to applying for a personal credit card–in fact, you could do both at the same time if you wanted. 

If you choose to use a business credit card, be diligent about paying your bill on time, if not sooner. Missed payments can have a big impact on your credit score. That’s true of both your business credit score and your personal credit score–what impacts one will impact the other.

Partner with Investors

Sometimes sharing the responsibility of funding your business purchases can lighten the load you carry for your business. If you aren’t too concerned about maintaining total control over your business, consider partnering with investors. Investors may offer a venture capital investment in exchange for an ownership share and active involvement in the company. Because these investors are essentially your partners, choose them wisely. You can’t afford to partner with just anyone if you want your business to succeed and for you to be happy with how things go.

They say you have to spend money to make money. While that isn’t true in every single case, it’s true more often than not. As you make plans for your startup, carefully analyze its needs and identify purchases you need to make for it. Come up with a ballpark figure for how much you need so you can determine what financing option will best suit your needs.

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