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You need capital to start your business, be it small capital or big capital it doesn’t matter. However, in order to finance your business it is not necessarily you have to use your own money as a capital. There are several ways to do it without using your own money.

Here are 7 possible ways for your business financing purpose:

When you’re still an employee or working for other people, it is a very wise decision to save some money. Thus in several years time, you should have enough amount of saving to start your small business without searching for other sources. By doing this, you can keep you day job and build your business slowly until you’re confident that your business can replace your day job.

2. Friends & Family

You could also ask your family & friends to give some cash in order for you to start a business. You have to convince them that you have a good business plan to be executed however the downside is that if your business don’t run smoothly, you couldn’t hide anywhere.

3. Bank

Certain banks could offer your a micro-lending scheme. The best example of micro-lending bank in the world is a Grameen Bank. Basically conventional banks will be reluctant to give their money to any people on the street with untested business idea.

4. Grants & Awards

Business grants always come from the government and awards is from other institutions such as foundations and big corporations. This is a free money from them because of social responsibility to create economic growth in the country. Grants & awards usually given to an established business and you have to follow their terms & regulations. That’s is why it is important to start a business in a small scale first before you apply any grants and awards from them.

5. Other Loans

You have to put a collateral may it be your retirement fund, your home, your life insurance policy. This is a risky step because if your business fails, you will lost everything that has been put as the collateral.

6. Personal loans & credit cards

This can be simply said as a desperate measures for your business financing. The application usually faster to be approved however it comes with a very high interest. Please be remember that there is a credit card scheme that can have an interest up to 24% per year.

7. Partnerships & Investors

If you don’t have enough money to start the business yourself, you might want to have a business partner or you have to find an outside investor for your business. This might become a good idea because you can have extra money and extra man power to run the business however, a good business partner is hard to be found. You may face few times of partnership splits before you are likely to find the best partner.

“A bank is a place where they lend you and umbrella in fair weather and ask for it back when it begins to rain.” - Robert Frost

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