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KristineS
05-11-2009, 12:41 PM
Articles like the ones I'll link to below always interest me. I read them to see if the people who wrote them really have good ideas, or if they're just being goofy. Some of the ideas in these articles I might use. Others I would not. In some cases, I'm not sure how creative the ideas are.

I'd be interested to hear what those of you who have actually started your own businesses think. Would you (or have you used) use any of these methods to start a business?

Creative Ways to Finance a Business Purchase (http://www.powerhomebiz.com/vol133/purchase.htm)

Creative Ways to Finance a Business (http://www.wordconstructions.com/articles/business/creativemoney.html)

15 Creative Ways to Raise Money (http://www.associatedcontent.com/article/213029/15_creative_ways_to_raise_money_for.html)

vangogh
05-11-2009, 01:23 PM
Some of the ideas aren't exactly creative. Apply for a loan for example. Seems pretty standard to me.

I think creativity in general is a good thing though the workability here is probably in the details. I saw a few examples in the articles having something to do with bartering. The idea of bartering itself isn't necessarily creative, but working things out so both sides are happy is.

If you work at something enough you can usually find some creative way to make all parties happy.

Would I have gone any of these routes to start my business? I'm not sure. I didn't really need a lot of money to get started and as I mentioned in another thread I did it mostly through credit cards. I suppose that qualifies as creative based on the articles you linked to. And especially since I often used the card to charge something non business related in order to free up money for something business related.

phanio
05-11-2009, 09:43 PM
There are many ways to finance - some creative for you and some not. But, what may be creative for you may not be for another.

I think tha goal is to get the financing that is best for you - regardless if it is creative or not. If a commercial loan from your bank offers the best rates and terms with the lowest fees and requirements - then that is the best but not very creative.

There are alternative financing. Things like:

Accounts Receivable Factoring
Purchase Order Factoring
Busienss Cash Advances
Peer-to-Peer Social Lending
Micro-Finance
Equipment Loans and Lease
Commercial Real Estate finance and refinance

None of these are really creative unless you use them to your advantage - i.e. combining two or three to get what you need. Or use one to get started then use another to better your position. The key again is to get what you need at the best rates and terms for you.

There is a couple of thing that I truely believe in business - it is always better to use someone else's money - and no matter what you think of the deal - someone else is also trying to make money.

KristineS
05-13-2009, 12:44 PM
I think you make a good point about using more than one method to get the financing you need, Phanio. As you say, maybe the creative part is figuring out how to use these methods together to achieve the desired results. I'm also guessing that's something that some people might not think to do. Thinking outside the box when it comes to financial issues isn't always an easy thing.

SteveC
05-13-2009, 07:40 PM
Let me tell you some of my story… in the nineties when I started out I had a limited amount of capital and most certainly not enough to do everything I wanted, sources of funds were scare and I needed to be able to afford to buy all of the software needed to run a good quality website design study.

What would you have done to fund this?

I set-up an online computer magazine which reviews software, produces original content and I guess demonstrates our expertise in this industry... by doing this at this time we were early to market, we gain acceptance by all of the major software vendors and their PR companies... this resulted in us gaining all of the software we needed to set-up and run in the early days... things have changed somewhat now, with special license requirements, etc...

However the important point to note is that by creative thinking we solved one major problem, we used similar type thinking to also solve other issues... running off to a finance company isn’t always the best use of your time.

orion_joel
05-14-2009, 01:04 AM
Some of the ideas in the second article are quite interesting. They really could be seen as creative.

Where as some of the ideas in the last article almost sound like they are saying start a different easier business to get the money coming in, or even change focus more to something like a part time job.

As creative as i got, was probably using credit card for everything. However did ensure that it was paid off each month. I guess you just get creative along the point of view that you could solve the problem and get creative in working out how to make enough profit to cover the expenses, and really just skip a step

Spider
05-14-2009, 09:41 AM
The creative financing ideas I like are the ones that eliminate the need for financing rather than creative ways of obtaining it. For example--

Have the landlord build out leased space to suit you and add the cost to the rent.

Stock your store with items on consignment.

Sign a long term supply contract with a materials supplier in return for them providing free or subsidized manufacturing or storage facilities on your premises.

Network marketing, multi-level marketing, affiliate marketing or drop-ship marketing.

Joint venturing.

Instead of selling "stuff" (with attendant wholesale purchases) provide a sales service to suppliers of that same stuff.

phanio
05-14-2009, 06:45 PM
Love the idea of funding your business with the online computer magizine - if you can find other ways to finance that is great and probably your best bet. You might even find that the online computer magizine or whatever you come up with is better than your original idea.

If you can find other means - these are the one you should always pursue first. But, if you can't - don't just run down to the bank and take whatever they shove down you neck. When you buy a car or a house or even clothes, you usually shop around - the same goes for debt financing - shop around for the best deal for you as well as try to find other ways that do not put such a large burden on your business.

You would be surprised at the number of financing alternatives that are out there. Some that do not require collateral or high credit and some that do.

KristineS
05-15-2009, 12:51 PM
Good advice, phanio. I think sometimes people are reluctant to shop around, they have more of a "take what you can get" mentality. The reality is that if one person is willing to give you a loan other people probably will be as well. You just have to put the time and research in to finding the best deal.

SteveC
05-19-2009, 10:42 PM
One thing I would like to add is barter... when I started up I also used to try and barter for everything... I want this, how about this product or service in return...

Bartering doesn't always work, but it does work and when starting out everything counts.

KristineS
05-20-2009, 12:33 PM
Barter can be a good thing. I've used that technique a few times. As long as you're careful to keep the value equal, you can get a lot done through bartering.

phanio
05-20-2009, 06:10 PM
Myself - not a fan of batering - partly because of the concern above about equal value and secondly - I just rather have cash - easier to pay bills that way.

vangogh
05-20-2009, 06:40 PM
Same for me. I do think bartering can work and is something worth looking into. Most of the times it's been offered to me the value hasn't even been close to equitable. I'm usually offered things I don't need or want that even if I did wouldn't come close to the cost involved for the work.

Still as long as you can set up an equitable trade it's a good idea. Keep in mind that means you do have to offer something of value. Some people seem to forget that.

Spider
05-20-2009, 08:24 PM
Incidentally, I believe bartering is still business and if you do $1,000-worth of work in exchange for someone doing $1,000-worth of work for you, that is still $1,000 of income on which you both must still pay tax.

Accountants in our midst will clarify, I hope.

Patrysha
05-20-2009, 09:08 PM
I only barter for things I would have paid for anyway (if I had the money).

Electrolysis & Facials & Family Photography for instance. I'd have to pay tax on those things whether I barter or buy. Of course, if they were to actually pay me for the marketing I do in trade...then I'd be forced (by personal conviction) to pay those dollars towards debt. (Which all in all is a good thing, but I'm not into clothes, I don't go ga-ga over shoes, so is having a few little luxuries in life too much to ask?) So sometimes I barter to get around it which allows me to network more efficiently because most of the clients I work with CAN afford those services without worrying about pesky details like family budgets. (I'll get there one day, I am just not there yet)

Then there are the barters that are a bit more business based. Like pending deals with a local printer, a local computer store and so on. I am hoping to cook up something for a local furniture/office supply store too.

Then again, I do make sure that barter is no more than 30% of my current business income when I make the agreement. As someone else said, I still need money to pay the bills.