REUTERS

Wells Fargo on Women Entrepreneurship: Find Funding to Grow Your Business

(Wells Fargo is No. 12 on the DiversityInc Top 50 Companies list)

Women’s History Month is a great time to recognize the important role of women-owned businesses in the nation’s economy. From tech to fashion to healthcare and manufacturing, there are 9.9 million women-owned firms spanning almost every industry, and representing a third of all small businesses in America. And that number is only expected to grow. According to the latest U.S. Census data, women-owned firms increased more than 26 percent from 2007-2012, and had receipts of $1.4 trillion in 2012.


Despite their successes, women entrepreneurs can face the same challenges as all business owners when it comes to obtaining funding for their businesses. This is especially true for new business owners who are just starting out and may have limited business credit history. There are, however, more small business funding options today than ever, and it pays to be familiar with each one.

Here are five types of funding to explore when starting, running and growing a small business.

SBA Loans and Resources Whether you’re launching a new business or growing an existing business, the U.S. Small Business Administration (SBA) has a variety of lending products designed to meet the financing needs of businesses of all sizes, including smaller, newer businesses. Through SBA lending, Wells Fargo offers financing to businesses that may not be able to obtain a conventional loan or loan terms that meet their business needs.

The SBA also has a number of programs and resources devoted specifically for women entrepreneurs. A good place to start is with the SBA Women’s Business Centers, which consist of nearly 100 educational centers around the U.S. These centers are dedicated to helping women start and grow their businesses by offering seminars and workshops on various business owner topics, including raising capital.

Business Credit At some point, most small business owners will see a need for credit as their business evolves and their financial needs change. When used appropriately, credit can fuel opportunities for business growth from helping cover basic expenses to supporting a capital expenditure. There are many types of credit to consider depending on your business financing needs and stage of business. Talk with a business banker to learn what option is right for your business.

Self-funding Many entrepreneurs fund their businesses themselves, either by tapping into savings, selling assets for cash, or taking on personal debt. While self-funding increases your personal liability, there are several advantages to this method of financing, including having complete control over your business’ financial decisions. As our bankers will tell you, self-funding is also a smart way to show that you are truly committed to succeeding the more you invest in your business, the easier it will be to secure capital from other sources down the road.

Investors Another common way to fund a business is through investors. Often, an investor is a family member or friend with the means to invest capital upfront to cover startup costs. While this may seem like a good idea at first, it’s important to set up a formal arrangement to protect your relationship from losses that may result if the business fails. If you want to steer clear of personal connections, then an angel investor may be a better fit. Angel investors are typically affluent individuals or investment groups who are willing to invest in new businesses and ideas. To improve your chances of securing an investor, you’ll need to demonstrate a healthy credit history, and provide a written business plan complete with a strategy for paying back investors.

Crowdfunding Based primarily online, crowdfunding is the practice of funding a project or venture by raising small amounts of money from a large number of people. While crowdfunding has been around for a long time, social media and online crowdfunding networks comprised of thousands of investors have helped it gain in popularity among entrepreneurs and startups. From donation-based, to rewards- and equity-based options, there are many types of crowdfunding options available. The method you choose may depend on the type of product or service your business offers, cash flow and revenue projections.

As you explore funding options, it’s also important to become familiar with the credit process so you know what to expect from preparing to apply, applying and managing credit. Wells Fargo’s new Business Credit Center is designed to help inform business owners on the credit process and financing options, and address gaps in their understanding of credit.

No matter how you fund your business, remember that knowledge is power. Take time to arm yourself appropriately so you can confidently navigate the credit journey throughout all stages of your business.

Read more news @ DiversityInc.com

Latest News

banned books

Texas Lawmaker Pursues Banning 850 Books From Schools Over Fears That They Might Cause ‘Student Discomfort’

The state of Texas is continuing its descent away from democracy and equality for its citizens. First came its horrifying rollback of women’s rights with its recent abortion ban. Then came its recent attack on trans students’ ability to participate in sports. Now, Texas lawmakers are at it again, this…

Border patrol agents

Government Establishes New ‘Protected Areas’ Where Illegal Immigrants Should No Longer Fear Being Arrested

Immigrants in the United States without proper documentation will no longer have to fear getting arrested at schools, churches, hospitals and a number of newly “protected” areas. The Associated Press has reported that the Department of Homeland Security and the U.S. immigration authorities issued new guidelines on Wednesday, Oct. 27,…

closeup of hand with remote

Anti-LGBTQ Group ‘One Million Moms’ Protests Mattress Company’s Inclusive Commercial Featuring Lesbian Couple

The conservative anti-LGBTQ hate organization known as One Million Moms is at it again, this time protesting a TV commercial from the bedding company Avocado Green Mattress, which features a number of couples relaxing on their mattresses, including what the group considers an “offensive” lesbian couple. The Advocate’s Trudy Ring…

girls high school sports

Texas Gov. Greg Abbott Officially Bans Transgender Students From School Sports

Holding true to threats he has made in the past, Texas Gov. Greg Abbott has officially signed into Texas state law a rule that would restrict transgender students from participating in high school sports consistent with their gender identity. ESPN’s Katie Barnes reported that following Abbott’s action, Texas has become…

Prince

Music Icon Prince Could Soon Be Honored With Posthumous Congressional Gold Medal

He changed music history and was the soundtrack for countless people’s lives, and now music legend Prince could soon be awarded a posthumous Congressional Gold Medal by the U.S. government. Mark Kennedy of the Associated Press has reported that “Minnesota’s Congressional delegation on Monday, Oct. 25, introduced a resolution to…