Action Steps
The best contacts and resources to help you get it done

Find small business loans for start-ups

As your first source in small business finance basics, your business might want to apply for small business loans. Banks and other financial institutions are the leading small business lenders. Although interest rates and qualifications for the loans vary, most sources provide financing for a business that qualifies. Shop banks until you find the right combination of interest rates and qualifications for your company.

I recommend: Start your search for small business funding at BusinessFinance.com. Your firm can find excellent general information and specific funding sources. Use the search function to find funding that matches your needs. Bank of America is a prime source of small business funds. Check out its tips on starting or growing your business.

Compare rates among small business financing companies

Once your team has researched bank loans, check with financing companies. Many are in business specifically to provide money for small business loans. Often they also will help with other aspects of starting your business, such as filing the proper paperwork and registering your business. Some but not all limit lending based on specific guidelines, such as to women-owned businesses or start-ups in a geographic area.

I recommend: Contact General Electric, one of the leading small business financing companies with more than $10 billion in loans annually. It specializes in loans for business real estate. Hoping to start a business in the healthcare field? Find financing information at ProMed Financial. It funds medical, dental and other health-related start-ups.

Get a grant for your small business funding

Grants can be an ideal source of funding for your start-up. The big advantage: your company doesn't have to pay the money back. However, there are some things about grants to consider. Grants are often competitive and might entail a detailed application process. Also, many grants take as long as a year or more to be finalized. Apply if your business qualifies and fits the grant time frame.

I recommend: Visit the U.S. Small Business Administration website for complete information on grants. Your staff can find information on a variety of grant types and sources. For information on small business grants for women and women-run businesses, see Women's Business Grants from Womens-Finance.com.

Helpful advice for making the most of this Guide

• •  Don't overlook local grant sources. Cities or other government agencies seeking to attract certain types of businesses or companies to targeted areas can be an important source of funding.

Guide to Finance Fundamentals

A few easy steps can help you better track your business' health

By Tom Nutile, Principal, TN Communications Group

1. How much money you are spending on your business
2. Who is receiving the money
3. How much you are taking in from clients, products or services.

Action Steps
The best contacts and resources to help you get it done

Brush up on basic financial terms

Business finance has its own language, so as you launch or run your business, learn some basic terminology, from accounts payable and cash flow to LLC (limited liability corporation). Being armed with the right knowledge can help you do a better job of negotiating.

I recommend: Learn the lingo from AllBusiness, YouthMatrix and the Sun Beach Public Library.

Write a business plan

Even if you've been planning for the launch of this business for years and have every detail in your head, it makes sense to write down your plan on paper, including the mission, your business model, possible competitors and threats, and your timetable for financial success.

I recommend: Get help writing a business plan through BPlans, BusinessPlanWare, The Business Mentor and Business Plans.

Calculate start-up costs

Determine how much money you'll need to start your business by using a worksheet or workbook. You may think you have a handle on costs, but there are likely to be expenses you haven't figured in.

I recommend: Calculate your start-up costs with assistance from the Better Business Bureau, FindLaw for Small Business, BusinessKnow-How or Adams Streetwise Small Business Startup.

Set up a basic bookkeeping system

You'll need to establish a basic bookkeeping system even before your business opens. A bookkeeping system records your financial transactions, including the money coming into and going out of your business.

I recommend: Use desktop accounting software, such as Peachtree Software's Peachtree Accounting or Intuit's QuickBooks. Get online outsourced bookkeeping services at BalanceYourBooks.com. Get bookkeeping services and advice at ProBookkeepers.com.

Establish a relationship with the right bank

Develop a relationship with a local bank where you can get to know the small-business staff. Open a business checking account, and talk with a bank officer about the right type of account for your business. Decide if you want a separate business credit card and see if the bank has a small business package that includes a business credit card.

I recommend: Find the best small-business bank in your area through this Entrepreneur.com search engine.

Hire an accountant

A certified public accountant can help you with your finances, from setting up a bookkeeping system to calculating start-up costs to doing your taxes.

I recommend: Find a CPA in your area as well as advice on how to hire and work with a CPA at the CPA Directory.

Helpful advice for making the most of this Guide

• •  Financial projections and a business plan are important, but they need not be lengthy. Two pages can suffice.
• •  Consider more than one bank for your business needs. Find the bank with the best business package or best loan. Don't overlook small local banks or savings and loans; just make sure they're insured with the FDIC or the FSLIC.
• •  When shopping for a loan, consider more than the interest rate. Pay attention to the length of the loan and the repayment.
• •  Don't be afraid to negotiate with your bank on the terms of your loan or credit line.
• •  In preparing your budget, add a 10 to 20 percent contingency line item for those costs you may not have anticipated.

Action Steps
The best contacts and resources to help you get it done

Use a loan for small business start-up

Once your business has secured a loan, you'll probably first spend your money on several 'musts.' One of the first requirements: register your business with the government and the IRS and pay all applicable fees. You must also get any the permits needed to start and operate your company. These might include licenses for materials handling, trucking or heavy equipment operation.

I recommend: Contact the IRS for information about small businesses. They'll help you register your business and provide a fee schedule and other paperwork needed. Check with Permits Plus for a list of licenses your firm will need, how long it will take to get them and for assistance in the application process.

Use small business loans to fund business growth

One of the most exciting aspects of small business ownership is the success that feeds the need to grow the business. Whether your company needs financing for more equipment, additional building space or a business acquisition, lenders have money. Some money comes with stipulations on how you can spend it, so be sure to check before you apply.

I recommend: Go to BuyerZone for financing for additional equipment needed by your expanding business. Note their other funding options. Secure a 504 loan from Biz Capital. The fixed-rate loan is earmarked for businesses to acquire real estate or furnishings and equipment for expansion or modernization.

Find small business lending for real estate

Most small businesses need to purchase land and buildings for their operations. Your business will find that small business financing companies offer commercial real estate loans. Some also have funding for leases and will help you manage leased properties.

I recommend: Get a business real estate loan from U.S. Bank to get your company started. A permanent location is a key business asset. Apply to American Finance Solutions for money for a variety of financing needs for your start-up. Take the time to speak with a business owner from the cadre of folks they've helped. They can offer tips and experiences.

Helpful advice for making the most of this Guide

• •  One source of small business finance that is often overlooked is grants. Look for government and non-profit agencies that provide funding for small businesses, often in local areas.

Guide to Small Business Finance Key Terms

Understanding your finance options can help you launch and grow your small business

By Lea Terry, Freelance Journalist / Copywriter

Action Steps
The best contacts and resources to help you get it done

Grants

Grants are one of the most sought-after forms of financing because they don't have to be paid back. However, they often have a lengthy and complicated application process, and are highly competitive. Still, they're an attractive financing option. There are grants for small businesses in general, as well as for women- or minority-owned businesses, or other specific criteria.

I recommend: Consult the Small Business Administration website for advice and resources on applying for small business grants.

Loans

If you can't win a grant, you may have better luck securing a loan. These do have to be paid back however, and you'll need to demonstrate to the lender that you have the means to do so. Most lenders offer loans specifically for small businesses.

I recommend: Seek out a lender such as CIT that specializes in providing startup loan money to small businesses.

Venture capital

This is funding specifically for startups. There are many firms that specialize in providing financial assistance to new, and often small, businesses.

I recommend: Turn to the National Venture Capital Association for advice on getting started with venture capital. Check out the group's "Resources for Entrepreneurs" section on its website.

Angel investors

While commercial financial institutions are certainly the obvious choice for seeking financial assistance, funding is also available from individual, private donors. These angel investors include everyone from third parties to friends and relatives.

I recommend: Check out "Ten Tips to Appeal to Angel Investors" from the Tri-State Private Investors Network.

Credit

When thinking of small business financing, don't overlook the importance of your company's credit card. In many cases, your company credit card can finance even major investments, for things like new technologies, as well as simply making it easier for employees to handle everyday purchases. More and more financial institutions offer credit cards specifically for small businesses.

I recommend: Most major credit card companies offer cards just for small businesses. As an example, check out the options offered by Discover Card.

Checking account

A key part of any small business finance plan is an affordable and versatile checking account, because this is what you'll depend on for your day-to-day spending needs. As with other financial services, most institutions offer checking accounts just for small businesses. These options may have a lower fee or include extra features to make it easier for small businesses to manage their spending.

I recommend: Find a bank with checking account options specifically for small businesses. Wells Fargo is just one of many financial institutions that offer these services.