Finding small business financing doesn’t have to be difficult. The new business financing web site, Small-Business-Financing.Com (http://www.smart-business-financing.com/) dispels the mysticism and takes some of the guesswork out of obtaining business capital.
September 22, 2010 – In today’s harsh economic climate, small business financing has become a challenging proposition for both entrepreneurs and the owners of existing companies. Federal Reserve Chairman Ben Bernanke recently estimated that at least $40 billion in small business loans has vanished in the economic slump. “Bank-dependent smaller firms have faced significantly greater problems obtaining credit, according to surveys and anecdotes,” he stated.
While smaller companies are indeed struggling in the slow economy, the problem isn’t a shortage of capital, says Mike Lieber, Smart-Business.Financing.Com creator and President of AEGIS Financial Solutions. “The problem is knowing where to look for it.”
“Unless you are a mega business with access to capital markets, financing a business definitely takes greater effort, creativity, and perseverance than it did a few years ago,” he says.
Since conventional wisdom holds that commercial banks are the most likely source of small businesses financing, naturally they are where most entrepreneurs and business owners turn first. In fact, commercial banks do much of the small business lending because they administer and provide funding for small business loans backed by the U.S. Small Business Administration and because a great deal of small business financing is accomplished through bank loans based on the business owner’s personal collateral, especially their homes. Contrary to popular belief, though, banks are not the only source for small business financing.
Banks are often criticized for their refusal to offer small business financing, particularly start-up loans, but they not supposed to use the savings from depositors on investing in risky business ventures. Regulators require banks to keep depositors’ money safe, making only conservative loans backed by solid collateral. In most cases, small business start-up loans are not safe enough to satisfy bank regulators and the businesses have little or no collateral.
According to Lieber, the answer to the small business financing problem is not found in banks – or at least not necessarily so – it is in the alternative commercial financing markets, where business capital is readily available for new and existing businesses.
“Where you look for money, and how you look for money, depends on your company and the kind of money you need,” he says. “There is a big difference between a high-tech company looking for expansion funding and a local retail store looking to finance a new location.”
Rather than simply giving up after a few bank rejections, current and prospective business owners can enlist the assistance of firms like Lieber’s to tap the enormous resources of the private, non-bank business financing market, which include:
• Private equity, joint venture, and angel funding,
• Asset-based lending
• Account receivable factoring
• Purchase order financing,
• Credit card factoring, and
• Consumer contract financing
Each of these techniques has its pros and cons, depending on the business and its circumstances. For most business owners, it is best to seek the advice of an expert who can find the best possible solution and assist with completing the steps to get an approval.
When business owners are willing to pursue various options, the chances of obtaining needed business financing are vastly improved.
Says Lieber, “Once the business owner is open to alternatives, the key is persistence – to continue seeking until the solution is found.”
About AEGIS Financial Solutions, Inc.: Founded in 1998, Mike Lieber’s company has been on a mission to help people solve financial problems and get money when they need it most, using the fast and flexible resources of the cash flow industry.
Mike Lieber, President
AEGIS Financial Solutions, Inc.
88 E. River Bend Road
Fredericksburg, VA 22407
PH: (540) 548-2270