Do You Have What It Takes For A Small Business Start Up?

By: Deanna Mascle -

If you are thinking about your own small business startup then you know your mind is overflowing with questions about business plans, business ideas, startup costs, and startup funding. Then there are the countless small decisions you will have to make about everything from phone service to business cards. However there is one very large question that overshadows everything else -- do you have what it takes to start up a small business? There are three keys to determining whether or not possess the essentials to start your own business.

The first key ingredient for small business success is having a passion for your chosen niche. You can learn more about business fundamentals and you can acquire more detailed knowledge about the field, but if you do not have a passion, or at least a strong interest, then you will not be as convincing a marketer whether it comes to your customers or to your backers. Also, that passion will be one of the key factors in your ability to overcome difficulty and challenges. No small business startup goes smoothly, no matter how well you prepare and plan in advance, and there will be tough times ahead. However a love of your business and its niche can carry you through.

The second key ingredient for small business success is drive. As I mentioned before you will have tough times but even when things are going well you will have to work hard and learn a lot to make a success of your business startup. If you want to succeed then you must possess a willingness to work hard and the willingness to learn the important lessons you need to start, run, and grow your business.

Finally, and this may be the most important ingredient of all, you must possess both the desire and ability to work for yourself. The first part is easy. Many people dream of the day they no longer have a boss watching over their work. That is why so many work at home schemes specifically mention you can "fire your boss". But not everyone possesses the ability to work without oversight. Sometimes they need the comfort of a fixed schedule and sometimes they actually need a person to crack the whip. Before you start up a small business you must honestly assess your ability to work without supervision and impose your own deadlines then meet them.

If you possess a passion for your field, the drive to work and learn, and the ability to work for yourself then you do have what it takes to start up a small business.

About the Author:

If interested in a small business start up then you should read this free small business startup guide at answersaboutsmallbusiness.com

Guaranteed Low Rate Business Startup Loan!

By: Kirthy V

Do you want to start a new business? Guaranteed Low Rate Business Startup Loan is the lifeline to your business. If you are a budding entrepreneur looking out for funds to meet your capital requirements, you can now seek help from new business startup loan.

Being a first timer you will need small cash for you business startup and guaranteed low rate small business startup advice steers you in the right direction. You might look for small business start up loan to buy office premises, equipment, raw material, to increase your capital or any other basic requirements. But whatever your needs, New business start up loan will serve you with instant decision guaranteed approval on business start up loan!

Purpose of Guaranteed Low Rate Business start up loan!

Equipment purchase or leasing Research and Development Land acquisition Establishing necessary infrastructure

Instant Decision on Business Start Up Loan!

If you can’t wait for long to get your business approval and are frustrated due to the bank loan delays, It’s time to give wings to your business startup ideas with a befitting Instant Decision on Business Start Up Loan. Your business dreams can wait no more….. transform your dreams into reality.

What works better for me - A secured business start up loan or an unsecured one?

Collateral Down Payment

These two factors play a pivotal role in obtaining low rate business start up loan guaranteed. Your collateral for secured small business startup loan enables you to take out a larger loan amount at lower interest and preferential repayment terms and conditions. Moreover secured business start up loans allows you to conveniently repay over 5 – 30 years. Larger repayment duration is useful for new entrepreneurs who have just set up a small business because they will have enough time in hand to repay the business loan. In addition to this some down payment will serve a great deal in lowering down your interest rate.

If you don’t want to run the risk of losing your home or assets and at the same time you’re equipped to handle your business financial needs, execute your business plans and run no risks of pledging your collateral with unsecured small business start up loan devoid the benefits enjoyed by the secured guaranteed low rate business start up loan. Bank on your online experts for any kind of business start up loan and choose your most befitting loan.

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Article Source: http://www.ArticleBiz.com

How to Finance Your Small Business Start Up

by: Robert Warlow

It all starts with a great idea, an idea that has probably been in your mind for a long time. You have the product sorted out, how you are going to deliver your service, where you are going to set up your office and how you are going to market your new business. But the stumbling block always seems to be the finance to get you going.

Finding the finance to get a small business off the ground is a major issue for any potential small business. Some new businesses lend themselves to very little start up capital because the main selling point is the owner’s skills and knowledge, for example consultants, web designers, PR specialists. Businesses which require stock holding, plant and equipment and other investment, face the real challenge of getting their start up finance together.

So what sources can you tap into to ensure your business gets off to a solid start?

Your Savings

The first port of call! If you have been in employment for some time then before going it alone you should hopefully have some spare cash behind you. Whether this be in the form of cash in a savings account or shares and unit trusts, this is a good start to your fund raising exercise.

You can be more focused in saving cash if you have had the goal of setting up your own business for awhile. Knowing you need to save to get your business off the ground will make sure you don’t spend your future nest egg on unnecessary items. Whilst a new Plasma TV or the latest DVD Recorder may seem to be an essential purchase, knowing that you have a business to set up in the future will be sufficient a deterrent to keep the cheque book firmly locked away!

Keep Your Job

Some business owners are lucky enough that during the early days of the business they can keep the day job while working on the business during the evenings and weekends. This has two benefits. Firstly, they are still earning thereby allowing more time to build up a cash reserve. Secondly, it’s an opportunity to test out the business to make sure there is a market.

Make sure that you can realistically keep both balls in the air at the same time otherwise you will end up doing justice to neither your job or your new business. The support of your family is also essential if you are to follow this strategy. They have to accept that what used to be ‘family time’ may have to take a back seat until you decide to concentrate on the business full time.

Family and Friends

These can be a useful source of finance for any start up. If you have harboured ambitions to run your business for some time, then many of your family and friends are already likely to know about your idea. You should therefore have an indication who is for it and who is against it.

If you haven’t shared your secret desire then it’s time to be slightly devious! If you are in the early planning stages start drip feeding your ideas to key people whom you think are likely to support you. Tell them your ideas, share your ambitions and goals and on a regular basis update them with your progress. The plan is to get them sold on you and your future business at an early stage.

Once you get to the point where you are ready to start asking for contributions hold an Investor Evening. Prepare a presentation outlining your plans, the business, the market etc. Show the potential investors what their return will be in recognition for supporting you.

Invite as many people as you can and promise an interesting and fun evening, Be bold at the very start; tell them exactly why they are there, so there are no misunderstandings. After you have done your presentation gather all the names of the people who may want more information or even a one-to-one with you.

Whilst this group are people who know you and so are more likely to trust you, don’t forget that you are developing a very different relationship which can quickly turn sour. Be prepared for rocky times!

Bank Line of Credit or Loan

Now you’re getting into the serious stuff! Getting support from a Bank for a new business is tough, as many entrepreneurs will testify. One sneaky way is to apply for an unsecured loan while you are still in employment. If you have planned things right you will know when you are starting up, so a few months before you pack your job in, apply for a loan based on your salary. However, make sure that you can comfortably meet the repayments. There is no grace period; you will be expected to pay back immediately, so your business will have to start earning very quickly.

The alternative is a business line of credit facility. There is no fixed repayment date, although they will be for periods from 6 to 12 months, and all you have to do is ensure that you keep within the overdraft limit. You will have to write a business plan to present to the Bank which outlines your idea and the business.

Mortgage or Equity Release

With the way house prices have been increasing over the last few years, the vast majority of people now have substantial equity in their homes. The cheaper alternative to a Bank overdraft or loan is a mortgage. The interest rate is lower and, as the repayments are spread over a longer period, the monthly repayment is less (although you will end up paying more interest in the long run).

The disadvantage of raising cash this way is that your home is potentially at risk. If meeting the monthly repayments is dependent on what the business can generate then a slow start could cause cash problems. So be very sure you can meet the repayments even during a lean period.

Credit Cards

If you haven’t got any savings, can’t get support from family or friends, or a Bank loan or mortgage, then there are your credit cards! However, whilst it’s easy to draw down on your card, be wary! Credit cards are the most expensive form of debt.

They are ideal because all you may have to do is pay the minimum amount but card debt, as most people have found out, can be a long term burden. But, if you need a cash lump sum to kick start the business and you know you can pay it off within a few months, then it’s an alternative source of finance worth considering, if somewhat unorthodox!

Business Grants

Business grants are available for specific industries, sectors and reasons. Grant providers will usually only give a portion of your requirement, so they cannot be used to totally finance a start up. However, they can be useful in filling a funding gap.

Business Angels

A popular way to fund a business are Business Angels. These are people, usually retired or successful business people in their own right, who are looking for opportunities to invest in new businesses.

In exchange for an investment they will typically look for a shareholding in the business and some hands-on involvement. They will have a vast business experience and so are useful people to have on board. However, you will have to accept an element of loss of control but that needs to be balanced against your desire for funding.

Getting finance for your new business can be a challenge but there are a number of avenues to explore and so with dedication and focus you could soon be on your way to launching your own small business.

The Tortoise and the Hare Model for Successful Small Business Start Ups

By: Susan L Reid

My mother used to affectionately refer to me as a turtle because at swim lessons, while the other kids eagerly jumped right into the pool ready to start, I stood near the edge, waiting. I wasn't afraid of the water. Rather, I was taking time to prepare for the event. Then, when I was good and ready, I jumped right in and swam.

Thus began my relationship with the fable "The Tortoise and the Hare" found in the much beloved bedside collection The Fables of Aesop. "The Tortoise and the Hare" is perfect for illustrating sound start up practices.

Aesop's The Tortoise and the Hare

Once upon a time, there was a hare who, boasting that he could run faster than anyone else, was forever teasing tortoise about his slowness. Then one day, the irate tortoise accepted the challenge when the hare boasted that "there was no one in the world who could beat him in a race."

The next day the race began, and the hare yawned sleepily as the meek tortoise trudged slowly off. When the hare saw how painfully slow his rival was, he decided, half-asleep on his feet, to have breakfast and a quick nap. "Take your time!" he said. "I'll have forty winks and catch up with you in a minute."

The sun started to sink below the horizon. The tortoise, who had been plodding towards the winning post since morning, was less than a yard away from the finish when the hare awoke with a jolt. Away he dashed! Though he leapt and bounded with great effort and speed toward the finish line, he was too late. The tortoise had beaten him. Tired and in disgrace, he slumped down beside the tortoise who said, with a knowing smile, "Slowly does it every time!"

The Tortoise and the Hare Start Up Model

From the very start of this fable, it seems absurd that the slow, prodigious tortoise would even consider pitting himself against the swift and built-for-speed hare. Though everyone can appreciate the tortoise's desire to quiet the hare's bragging and silence his teasing, to the tortoise, the race was never about speed or silencing a bully. It was about following through on his word. It was walking the talk, doing what he said he would do--something the hare never saw coming. The tortoise was all about the long game while the hare was about the short. Both approaches are important for a successful small business start up.

The Tortoise Speaks

Do you have an overall plan for start up success and becoming a leader in your industry?

• Do you have a viable niche market? • Do you have a purple cow product/service? • Is your profit margin adequate to support your income goals? • Do you have cohesive branding that effectively communicates what you do? • Do you have a business coach or mentor? • Do you have lots of time? • Do you have the courage and commitment to see it through? • Do you have sustained financial recourses?

The Hare Chimes In

Are you able to easily adapt and maneuver within the overall plan?

• Are you computer savvy? • Do you have a reliable computer with high-speed Internet service? • Does a reputable Internet company host your domain? • Do you have the tools and skills to create a web site and edit web pages? • Do you have a variety of ways to drive visitors to your web site? • Do you have an Internet merchant account and shopping cart? • Do you have a list serve or another way to send thousands of emails out to customers/clients?

The Tortoise and the Hare Share Thoughts

Realistically, it takes the winning combination of tortoise and hare characteristics to successfully start up and launch a new small business. It really isn't a matter of one being better than another, nor is it about choice. It's a combination of preparation, flexibility, strategy, ability, sustainability and maneuverability in today's business world that makes the difference between a success start up success and failure.

Moral of the Story

Getting out to an early start may seem like the thing to do, yet, the moral of The Tortoise and the Hare is that slow and steady wins the race. Follow the example of the tortoise: focus on the task, pay close attention to the tried-and-true business start up fundamentals, and see things through. Then follow the example of the hare by being nimble and quick to adapt and maneuver when necessary. Taking the best from both the tortoise and the hare ensures that slow and steady will win the race, while high-octane speed and adaptability will set the pace.

Show Me the Money: 7 Cash Stashes for Small Business Start-ups

by Susan L Reid

As a small business start-up coach, I get asked a lot of questions. The most frequent one: Where do I get start-up cash?

I’m always glad when my clients ask me this question. Their readiness to take financial responsibility for their business is a sure sign that they’re serious about starting it.

Not All Money Is the Same

There are two types of start-up financing: debt and equity. Consider what type is right for you.

Debt financing is the use of borrowed money to finance a business. Any money you borrow is considered debt financing.

Sources of debt financing loans are many and varied: banks, savings and loans, credit unions, commercial finance companies, and the U.S. Small Business Administration (SBA) are the most common. Loans from family and friends are also considered debt financing, even when there is no interest attached.

Debt financing loans are relatively small and short in term and are awarded based on your guarantee of repayment from your personal assets and equity. Debt financing is often the financial strategy of choice for the start-up stage of businesses.

Equity financing is any form of financing that is based on the equity of your business. In this type of financing, the financial institution provides money in return for a share of your business's profits. This essentially means that you will be selling a portion of your company in order to receive funds.

Venture capitalist firms, business angels, and other professional equity funding firms are the standard sources for equity financing. Handled correctly, loans from friends and family could be considered a source of non-professional equity funding.

Equity financing is usually a larger, longer-term investment than debt financing and often involves stock options. Because of this, equity financing is more often considered in the growth stage of businesses.

7 Main Sources of Funding for Small Business Start-ups

1. You

Investors are more willing to invest in your start-up when they see that you have put your own money on the line. So the first place to look for money when starting up a business is your own pocket.

Personal Assets

According to the SBA, 57% of entrepreneurs dip into personal or family savings to pay for their company's launch. If you decide to use your own money, don’t use it all. This will protect you from eating Ramen noodles for the rest of your life, give you great experience in borrowing money, and build your business credit.

A Job

There’s no reason why you can’t get an outside job to fund your start-up. In fact, most people do. This will ensure that there will never be a time when you are without money coming in and will help take most of the stress and risk out of starting up.

Credit Cards

If you are going to use plastic, shop around for the lowest interest rate available.

2. Friends and Family

Money from friends and family is the most common source of non-professional funding for small business start-ups. Here, the biggest advantage is the same as the biggest disadvantage: You know these people. Unspoken needs and attachments to outcome may cause stress that would warrant steering away from this type of funding.

3. Angel Investors

An angel investor is someone who invests in a business venture, providing capital for start-up or expansion. Angels are affluent individuals, often entrepreneurs themselves, who make high-risk investments with new companies for the hope of high rates of return on their money. They are often the first investors in a company, adding value through their contacts and expertise. Unlike venture capitalists, angels typically do not pool money in a professionally-managed fund. Rather, angel investors often organize themselves in angel networks or angel groups to share research and pool investment capital.

4. Business Partners

There are two kinds of partners to consider for your business: silent and working. A silent partner is someone who contributes capital for a portion of the business, yet is generally not involved in the operation of the business. A working partner is someone who contributes not only capital for a portion of the business but also skills and labor in day-to-day operations.

5. Commercial Loans

If you are launching a new business, chances are good that there will be a commercial bank loan somewhere in your future. However, most commercial loans go to small businesses that are already showing a profitable track record. Banks finance 12% of all small business start-ups, according to a recent SBA study. Banks consider financing individuals with a solid credit history, related entrepreneurial experience, and collateral (real estate and equipment). Banks require a formal business plan. They also take into consideration whether you are investing your own money in your start-up before giving you a loan.

6. Seed Funding Firms

Seed funding firms, also called incubators, are designed to encourage entrepreneurship and nurture business ideas or new technologies to help them become attractive to venture capitalists. An incubator typically provides physical space and some or all of these services: meeting areas, office space, equipment, secretarial services, accounting services, research libraries, legal services, and technical services. Incubators involve a mix of advice, service and support to help new businesses develop and grow.

7. Venture Capital Funds

Venture capital is a type of private equity funding typically provided to new growth businesses by professional, institutionally backed outside investors. Venture capitalist firms are actual companies. However, they invest other people's money and much larger amounts of it (several million dollars) than seed funding firms. This type of equity investment usually is best suited for rapidly growing companies that require a lot of capital or start-up companies with a strong business plan.

Conclusion

Start-ups often take more time and money than budding entrepreneurs are prepared to handle. Still, with the right source of cash, there is no reason that you need to live off Ramen noodles in order to get your start-up running.

How to ‘Start’ Starting your Own Business
by Audrey Burton

Most people in very small businesses start their businesses from a passion. This an excellent place to start – assuming there is a need in the marketplace for what you are selling.

A business associate of mine is a residential real estate agent in the San Fernando Valley area of Los Angeles, California. She told me recently that there are 14,000 real estate agents in the San Fernando Valley!! Holy cow that's a lot! Anyone considering starting a real estate business in this geographic area should do a lot of research and hard thinking before getting their license.

When you are deciding to start your business, the absolutely most important question you need to answer is: Is there a market for this? Big companies spend sometimes hundreds of thousands of dollars on market research answering that question before introducing a new product. You have a fabulous tool at your disposal that is almost totally free – the internet. That can give you a good start in your research.

The next very important question that requires an answer is: Who is your target market? In other words, who, specifically, will pay for what you are selling? If your answer to this question starts with "Anyone who…" that's not a target and your chances of success are very limited.

If you try to appeal to "Anyone who…", it will be almost impossible to make an emotional connection of any kind or to build any kind of relationship with prospects with your message. What will ultimately happen is you will water down your benefit statements and marketing copy to try to appeal to as broad an audience as possible, which will result in boring, mediocre marketing that leaves no lasting impression on anyone.

One more basic requirement for success in starting a new business is – mo'ney! That really tired statement, "It takes mon'ey to make mon'ey" is actually true. I suggest having at LEAST 24 months of living expenses saved, plus your start-up costs, before starting your business. If you have already committed to it without that kind of savings, you can expect to incur some debt. This is normal!

So, in summary, to start a business, it is important to have a passion, a need in the marketplace for your product/service, a clear, narrow target market and some start-up mon'ey. Can you make a success without these? Of course! It is just a lot more challenging!

7 Cash Stashes for Small Business Start-Ups
by Susan L Reid

The number one question I get asked as a small business start-up coach is: Where do I get start-up cash?

I'm always glad when my clients ask me this question. If they are asking this question, it is a sure sign that they are serious about taking financial responsibility for start it.

Not All Money Is the SameThere are two types of start-up financing: debt and equity. Consider what type is right for you.

Debt Financing is the use of borrowed money to finance a business. Any money you borrow is considered debt financing.

Sources of debt financing loans are many and varied: banks, savings and loans, credit unions, commercial finance companies, and the U.S. Small Business Administration (SBA) are the most common. Loans from family and friends are also considered debt financing, even when there is no interest attached.

Debt financing loans are relatively small and short in term and are awarded based on your guarantee of repayment from your personal assets and equity. Debt financing is often the financial strategy of choice for the start-up stage of businesses.

Equity financing is any form of financing that is based on the equity of your business. In this type of financing, the financial institution provides money in return for a share of your business's profits. This essentially means that you will be selling a portion of your company in order to receive funds.Venture capitalist firms, business angels, and other professional equity funding firms are the standard sources for equity financing. Handled correctly, loans from friends and family could be considered a source of non-professional equity funding.

Equity financing involves stock options, and is usually a larger, longer-term investment than debt financing. Because of this, equity financing is more often considered in the growth stage of businesses.

7 Main Sources of Funding for Small Business Start-ups

1. You

Investors are more willing to invest in your start-up when they see that you have put your own money on the line. Therefore, the first place to look for money when starting up a business is your own pocket.

Personal AssetsAccording to the SBA, 57% of entrepreneurs dip into personal or family savings to pay for their company's launch. If you decide to use your own money, don't use it all. This will protect you from eating Ramen noodles for the rest of your life, give you great experience in borrowing money, and build your business credit.

A JobThere's no reason why you can't get an outside job to fund your start-up. In fact, most people do. This will ensure that there will never be a time when you are without money coming in and will help take most of the stress and risk out of starting up.

Credit CardsIf you are going to use plastic, shop around for the lowest interest rate available.

2. Friends and Family

Money from friends and family is the most common source of non-professional funding for small business start-ups. Here, the biggest advantage is the same as the biggest disadvantage: You know these people. Unspoken needs and attachments to outcome may cause stress that would warrant steering away from this type of funding.

3. Angel Investors

An angel investor is someone who invests in a business venture, providing capital for start-up or expansion. Angels are affluent individuals, often entrepreneurs themselves, who make high-risk investments with new companies for the hope of high rates of return on their money. They are often the first investors in a company, adding value through their contacts and expertise. Unlike venture capitalists, angels typically do not pool money in a professionally-managed fund. Rather, angel investors often organize themselves in angel networks or angel groups to share research and pool investment capital.

4. Business Partners

There are two kinds of partners to consider for your business: silent and working. A silent partner is someone who contributes capital for a portion of the business, yet is generally not involved in the operation of the business. A working partner is someone who contributes not only capital for a portion of the business but also skills and labor in day-to-day operations.

5. Commercial Loans

If you are launching a new business, chances are good that there will be a commercial bank loan somewhere in your future. However, most commercial loans go to small businesses that are already showing a profitable track record. Banks finance 12% of all small business start-ups, according to a recent SBA study. Banks consider financing individuals with a solid credit history, related entrepreneurial experience, and collateral (real estate and equipment). Banks require a formal business plan. They also take into consideration whether you are investing your own money in your start-up before giving you a loan.

6. Seed Funding Firms

Seed funding firms, also called incubators, are designed to encourage entrepreneurship and nurture business ideas or new technologies to help them become attractive to venture capitalists. An incubator typically provides physical space and some or all of these services: meeting areas, office space, equipment, secretarial services, accounting services, research libraries, legal services, and technical services. Incubators involve a mix of advice, service and support to help new businesses develop and grow.

7. Venture Capital Funds

Venture capital is a type of private equity funding typically provided to new growth businesses by professional, institutionally backed outside investors. Venture capitalist firms are actual companies. However, they invest other people's money and much larger amounts of it (several million dollars) than seed funding firms. This type of equity investment usually is best suited for rapidly growing companies that require a lot of capital or start-up companies with a strong business plan.