djbaxter

Administrator
Some interesting stats and recommendations for startup financing...

4 Things to Know About Business Debt
By Rieva Lesonsky, AllBusiness.com
May 12, 2017

The more employees a business has, the more likely it is to use business debt for growth and to take on multiple types of debt or multiple lines of credit. While this is partly because larger businesses tend to be more established (and hence better credit risks), it could also mean owners of very small businesses aren’t taking the necessary risks to launch and grow their companies.

Is fear of debt holding you back from seeking a loan to start or grow your business? It shouldn’t. Keep a couple of things in mind:
  1. Banks aren’t your only source for startup or growth capital. To launch their companies, about three in 10 survey respondents got friends and family to lend them money. Nearly one-fourth took a bigger risk by putting their homes on the line with a mortgage or home equity line of credit. In addition, 3% have used a non-bank, market-based lender at some point.
  2. A whopping 88% of survey respondents who have taken on business debt say their experience with the lender was somewhat or very positive.
  3. Three-fourths say they rely on bankers as trusted financial advisors for their businesses. Choosing the right business banker can give you a second opinion on financial decisions affecting your business—not just loans and lines of credits, but the best ways to grow and finance growth.
  4. Selecting a smaller bank with close ties in the community can help you develop a more personalized relationship. Twenty percent of borrowers surveyed use commercial banks, 20% use community banks, and 18% use regional banks; just 14% use a multinational bank.


Read more...
 
Top Bottom