Getting a traditional bank loan can take weeks of paperwork and meetings in order to get the funds your business needs, and even then, you may not qualify if you don't meet the bank's strict standards of creditworthiness. Years-old mistakes or a lack of collateral can lead to a rejected application without the bank considering your improved recent track record of successfully running the business.
There are other options for financing, but many of them can't generate the amount of money your business needs or the funding solution may require some money to get started. When one type of financing isn't suitable to meet your needs, it's time to consider combining different types of financing to get the job done.
Scenario #1: New Product Idea
As you run your retail store, you have a great idea for a new product that you've never seen anyone sell before. After doing intensive research, you determine that your idea is viable and you find a company willing to manufacture it--but you don't have enough cash flow to pay the costs to have it made.
After applying for a patent so that no one can steal your idea, you decide to raise the money through crowdfunding, offering the new product (once it is made) to those who donate. You soon find that the trick to successful crowdfunding is marketing your campaign, which requires money for a website, Google and Facebook ads, and a social media presence.
You decide to apply for a business cash advance to get the money for marketing your crowdfunding campaign. Word of mouth spreads quickly, and your new product hits the shelves 6 months later, enabling you to pay back the cash advancement as well as ship products to your loyal crowdfunders.
Scenario #2: Convincing Investors Your Business Is a Good Risk
Your tiny restaurant is selling out every night and you really need to expand. Moving to a new place would be cheaper than adding on to your existing location, but you are ideally situated in a new and growing area. You aren't making enough money to finance an expansion on your own, so you decide to seek out investors that will support your efforts in exchange for a cut of future profits.
Between labor issues, fluctuating food costs, and a broken stove, however, your cash flow becomes a bit unsteady. Some months show healthy profit, but others are lean enough to risk suppliers or payroll not being paid on time. Rather than allowing late payments to disrupt the flow of the business and scare off possible investors, you apply for a business cash advance to ensure steady cash flow when it is sorely needed.
A few months later, a prominent local businessman decides your place is the perfect investment for him and writes a check that covers all your expansion needs. With careful planning, you stay open during construction and soon your advance is paid, setting up your investor for a healthy return from the new, bigger restaurant space.
Quikstone Capital Solutions offers business cash advances to business owners that need quick cash for a new idea or to expand their businesses.
