The decision between using personal or business funding to operate a business is one that holds significant financial weight. It is a decision that should be considered carefully – especially if the business is new or has not yet established business credit. Some owners run their professional business like a side gig and when considering business finance, it becomes a fatal flaw.
Some business owners opt for personally financing business operations because:
- Using cash on hand avoids debt accumulation and owners feel the business has a better chance of survival with less debt.
- The hassle of filling out complex paper work and going through a long approval processes is more than many owners want to tackle.
- Business operations feel simpler without managing extra interest payments or credit lines.
- Owners fear being declined due to poor personal credit
- Owners who have been declined in the past, don’t want a repeat.
Although these are valid concerns, there are some significant advantages to operating with business funding:
“Business credit offers entrepreneurs the opportunity to break free from the constraints of traditional funding methods and scale their ventures more effectively. “
~FORBES – “Debunking Common Misconceptions:
Personal Credit Vs. Business Credit”.Jack McColl. April 2023
The Benefits of Business Funding
💲Long Term Personal Freedom: Using personal finances for business may cause owners to have trouble getting major personal items such as an auto or mortgage loan.
💲Negative Future Impact: The use of personal finance typically has a negative affect on business credit or loan approval, rates and terms.
💲Separation of Finances: If something goes wrong with the business, your personal assets aren’t affected.
💲Increased Funding and Scalability: Getting a loan or inviting investors onboard adds extra fuel to your business. It helps you grow bigger and faster than personal funds alone.
💲More For Less: Most business credit and loans have lower interest rates and higher credit limits
💲Additional Opportunities: Working with investors or lenders isn’t just about the money. It can open doors to new people and opportunities in the business world.
💲Sends A Message: Securing business funding is like a badge of honor. It tells everyone that your business is serious, stable, and ready to take on bigger challenges.
💲Growth Opportunities: More access to funding allows
Gaining access to optimal funding requires expert knowledge and planning. The network of experts partnered with Tailor Made Business Funding have helped numerous owners navigate the funding maze and successfully obtain the funding necessary to grow and thrive.
Schedule your funding planning session today and experience what sets us apart.