How to Finance Your Start-Up Business

Creating a start-up is an incredibly exciting time for entrepreneurs, but it can quickly get tough when it comes to securing finance to help your business grow. Luckily, there are several ways you can raise finance to get your new venture off to a great start.

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Angel Investment

Fans of Dragon’s Den will be familiar with the concept of ‘angel’ investing – an individual will provide their own funding for a stake in your business to help get it up on its feet. Angel investors may provide you with support and guidance as well as capital. Forbes also recommends it as a great way to fund start-ups. However the hands-on approach of angel investing may be a negative for some who would prefer more autonomy in how the business is run, especially in the early years.

Banks

The traditional banks also have their advantages when it comes to seeking finance for your start-up. They may be able to offer you more money as a business loan, and they tend to give you autonomy in running a business. However, the bar to get a business loan can be higher than other types of financing, and many will ask for a Director Guarantee on personal assets before approval. This can have huge repercussions if something goes wrong, so if considering this, it is wise to get legal advice from a reputable firm such as www.parachutelaw.co.uk/director-guarantee, who can help you decide if it’s the right choice for your business.

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Government Start-Up Loans

The government also offers loans for new businesses that may not be able to access traditional finance through their bank – the British Business Bank. You can apply for up to £25,000 with 6% interest.

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