New Business Finance

[PetaS]

Hi,

My husband and I launched into our business a year ago and it has been doing quite well but has so much more potential - we just need to inject some money into the marketing. Without that I fear we will be treading water for a while.....

Because we both left work to start the business and it has only been running for a year we are having difficulty getting finance. We are at 63% with our home loan and banks are now knuckling down on this option. You must be under 60%.

Any other suggestions?

Thanks
Peta

[Lisa Murray - Biz Coach]

Hi Peta
It depends on what type of marketing you are thinking of doing. Some of the direct response (online and offline) agencies will take staggered payments, allowing you to make some money from your campaign before you have to pay up! Check out www.mediaglue.com.au as one example.

[LeelaCosgrove]

Even better - here's an investment that will make ALL of the difference in your marketing ... spend the $50 to buy this book

"Getting Everything you Can out of All you've Got" by Jay Abraham.

You should be able to get it at a good book store (although I've found, generally, it's easier to get either in the city or online).

Jay is an internationally recognised authority on marketing and has started many businesses with no money down. This book will CHANGE the way you think about marketing.

He'll show you how to get free advertising space in magazines, how to structure barter deals, how to develop host-beneficiary relationships. I've had a huge amount of success implementing what I learned from this book ... and so have my clients and other people I've recommended it to.

[lindyasimus]

Leela's suggestion is a good one. A lot of business increase can be made without spending a fortune. The marketing that you want to do, may not need a loan to finance it.

Investing in membership of a good BNI chapter in your area may be enough to kick start you into being in the position to plan a grander marketing strategy (and qualify for a business loan if need be).

Consider who is in your immediate business network with whom you could generate some cross promotional lead opportunities. That is after all, what social networking is ideally geared to enable us to do.

[toddo]

Peta,

I realise its been a month since you left your post but I have only just joined so I thought i would respond anyway. Obviously the implementation of the previous ideas will put you in good stead. If however you still want to pursue finance then all is not lost. I can only assume from what you have posted that you have a lo-doc home loan or something similar. Banks will fund business loans up to 80% where you are show reasonable results and have a strong plan of action.

Many business bankers will accept that you may not even make profits in the first year. If as you say, you are doing well then I suggest you put together your financial statements and approach a business banker for help. It shouldn't be a surprise that you might be told no on the first approach. If you want to contact me by email please do so and I can give you some tips on what to do and also some contacts to talk to if you need it.

Cheers

[Burgo]

Online Small Businessbooks, who is a member may have Jay Abrahams book

Have you a Business Plan that you could run past a bank, even talk to a business coach. What are the other options?

[Marcus]

I work for one of the big four banks (not sure of the rules on posting the name here), and my job is lending etc for small businesses who require funds $100k and below.

I can tell you we use up to 80% of the value of the property as security and still offer unsecured loans to the right client. Even though your business is in the first year I wouldnt give up on obtaining finance.

As has been touched on, get together a cash flow forecast for the next year. Ideally get your accountant to do this unless you are confident on doing it yourself and can back up your forecast with assumptions etc. Another item that has been touched on is the business plan. Once again if you aren't comfortable doing it yourself sit down with a professional in this field.

Another good tip is to take in your last personal tax return that showed the level of income you were on as an employee. This gives the bank some piece of mind that if the business doesn't go as planned you have the possibility of going back into the workforce and earning $x which will go towards servicing the remainder of the business loan.

I dont want to sound like a walking advertising board, if you want any specific info just pm me.

[robbyst]

Find a partner willing to invest or borrow the money informally form someone you know, this is used nowadays as an alternative to banks. You have to show them your plan to invest the money and what would be the benefits for them though.