10 Ways to Finance Your Business | Brian Tracy #Finance

hello I’m Brian Tracy and I have personally started built managed or turned around 22 businesses but more than that I’ve worked with more than 10,000 business owners starting one-person businesses on their kitchen tables and people who run billion-dollar enterprises and one of

the key questions that keeps coming up is where do you get the money to Finance your business well there’s many different ways and in this time that we spend together I

want to give you 10 ways that you can Finance your new business 68% of startup financing comes directly from the pocket of the business owner I remember listening to a

professor talk and saying never put your own money into your own new business and this person was a complete idiot you cannot start a business without your own money and nobody will lend you any money unless you’ve got hurting money on the table in there so you can sell high-priced items that

you simply don’t need to raise the money you know there’s some times you have to sell a lot of stuff to get the cash you need you’re going to have to like plain of No Limit poker you’re gonna have to go all-in now a second ways you can get money to start your business is

with angel investors now angel investors are people who have money and they’ve made it through their own business and through their own careers and what they’re looking for is opportunities to get a high return on their money the venture Capitalists and these are kind

of angel investors are kind of like little venture campus they’ll make a lot of small Investments hoping that one or more of them will really explode the reason that you use them is because there’s a lot of them they have different parameters some invest in high tech

some invest in restaurants some invest in different types of businesses they also bring with them really good knowledge of Industries so they are not only an investor but they give you

really good ideas and sometimes they can give you guidance with regard to product development marketing sales and so now the pros and cons the pros of using an angel investor is they’ve got the money and they can make a decision quickly the cons are is that they will want to take a part of

your business sometimes a substantial part like venture Capitalists they’ll often want the right to step in and take over your business and push you out completely if you do not deliver on your projections they want to protect themselves and they’re very smart about

protecting themselves now the third place you can get money is friends and family now it’s interesting with friends and family we say that we call this love money is people who give you money or lend you money because they love you now it’s a terrific idea in theory to get money from

your fans and family when I started my business by the way I have used all of these and I had to go to my brother’s and I had to go to my parents and I had to go to my friends that I’d worked with and hat in hand and ask them for money to get started or to keep going now there’s

one crucial rule when you’re dealing with friends and family is put everything in writing this makes sure that it’s absolutely clear how much they are putting in and how much they will get out and when they will get it out the pros and cons of friends and family are that they can be a

real pain in the neck they can call you up every day and say how’s it going when can I get my money back how soon can I get my money back and so be careful when you take money from people that you know it can be more expensive than you realize and not just financially now another place to

raise money is with Credit cards now it’s good in theory to raise money with Credit cards but before you turn to plastic for financing consider the risk the pros are you can get large amounts of Capital quickly the cons are you pay very very

high Interest Rates so if you’re going to borrow money on your Credit cards plan to pay it back quickly because if not that interest will add up fast and it can eat you alive now when I started off my business one of the things I did and somebody taught me

this get good Credit before you need it now another way to raise money in financing is with bank Loans now it’s the most amazing darn thing people say well just go to the bank and borrow money so you go to the bank and the bank says no and you go to the next

Bank that Mac says no because see well why won’t banks lend me money to start up my business banks don’t lend money to start up businesses banks are in the business of making good Loans that they are absolutely sure can be repaid now banks are the most traditional and

conservative ways to Finance a business but they’re the hardest Loans to get why is because the banker that you’re talking to his pay his bonus

his promotion everything is totally determined by him making good Loans so they don’t care about the fact that your business idea is a great business they mentally put that aside what they want is convince me that you will pay the money back even if your business collapses so

what do you need well first of all you need a solid business plan when you go to visit the bank and you need realistic financial projections also however you need collateral or other existing business Assets that they could seize in the event of a default here’s an important

point when I started my business and I built it successfully and then I moved to a new city where I needed to get a new Loan I went to the bank and they went back and forth with me for weeks and months and finally they told me that they needed five hundred percent of asset

collateral for every $1 that they would lend so I had to prove to them I had to put up my house my car my royalties I had to give them and prove to them that I had five dollars for every dollar that they were advancing me once they were convinced of that then they lent me the money and watch me

very closely and when I paid it back over time then they reduced their collateral requirements so all it required was my business operations and a personal guarantee now another way to raise money is called micro Loans now micro Loans are small

Loans that you can get for short term the supplier of micro Loans in the space is called the Small Business Administration SBA they’ve launched a micro Loan program to help small businesses secure the financing they need to either get started

or to get through a tough time to apply for a micro Loan is not that easy you’ll have to be within the local lending area of one of the 170 nonProfit intermediaries that process micro Loans most micro lenders also require borrowers to

complete business training and business planning seminars before receiving the Loan so if you’re thinking of starting a business you call your local SBA or you go onto the internet and you find a small business investment corporation often these are funded by individuals

often they’re funded by governments but their sole job is to give money or to lend money under very tight conditions to entrepreneurs and business owners to startups who cannot get the money they need but who have a good business idea in the first place now another way you can get money is

called social lending there are so-called social landing websites where individuals can apply for Loans from other individuals where they monetize it and everybody puts money into a pool and then there are people who watch it carefully who will lend out small Loans

so remember whenever you borrow money the person who is lending you the money has just one thought in mind how soon will I get it back and how much will I get back and if I’m lending you money and taking a piece of your business what will be my potential upside another way to raise money is

with trade Credit now trade Credit is based on trust and many companies are started on the basis of trade Credit one of the biggest companies in the United States started off with one man with a $1,000 Loan from his mother and he

went out and he sold a new service and every company he spoke to said no we’re not interested until finally he found one company that says yes we’re interested in the service and then he said wonderful I’ll need a deposit of 50% down so that I can install the service until it

begins paying for itself and this one customer said all right I faith in you I will pay a 50% deposit and you can then start installing the service that you’re selling he went on to become one of the richest men in the United States so whenever you can use trade Credit which

means that you can get Credit from your suppliers or even Credit from your customers you can built your business as a new business that might take a lot of legwork and a little bit of luck to secure trade Credit but it’s worth it and the last

type of financing that we talked about before is customers you can go to customers and ask them to pay you deposits ask them to pay you in full in advance you can show them show your business plan and convince people that your business is solid so that they can feel confident and giving you money

even before your business is off the ground now the pros and cons of this are that if you’re going to buy the ingredients to create your products and services you have to turn them into cash quickly what this means is that if you have an ongoing and successful sales process so that you can

buy the post supplies sell them and pay them back you can start a business with very little cash of your own and building on the cash and Credit of others so there’s lots of ways to start a business but the wonderful thing is this is that if you are creative and you’re

determined you can start a business with very little money down with very little of your own money and with very little of anybody else’s money if you enjoyed this CashNews.co and you feel it was valuable subscribe to my channel like this CashNews.co and share this CashNews.co with your

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