Many people think that in order to get money for their small business, they have to have a rich uncle or some other type of financial backing. The truth is, there are many ways to get money for your small business without going into debt or taking out a loan. Here are a few tips on how to get money for your small business.
1. Act like a business. This may seem like an obvious one, but it's important to have all of your ducks in a row before approaching potential investors. Make sure you have a catchy and accurate name, website, address, phone number, and email set up for your business.
2. Incorporate with your state. You can decide if you want to file for an LLC, S, or C corp. An LLC is a limited liability company. An S-corp is a subchapter S corporation. A C-corp is a regular or classical corporation. The main difference between them is how they are taxed. An LLC is not taxed as a separate entity like an S corp or C corp. The profits and losses of the LLC pass through to the members and are included on their individual tax returns. This can be advantageous because the members can report losses on their personal returns, which may offset other income. An S-corp is taxed as a separate entity. The profits and losses of the S corp pass through to the shareholders and are included on their individual tax returns. This can be advantageous because the shareholders can report losses on their personal returns, which may offset other income. A C-corp is taxed as a separate entity and the profits and losses are not passed through to the shareholders.
3. Get your EIN and DUNS numbers. An EIN, or Employer Identification Number, is a nine-digit number assigned by the IRS to track a business' finances. It is essentially the business equivalent of a Social Security Number. EINs are necessary for businesses that have employees, file taxes, or want to open a business bank account. A DUNS number is a unique nine-digit identifier for businesses, assigned by Dun & Bradstreet. This number helps track your business' credit history and credit rating. It's important to make sure your DUN number is accurate and up-to-date, so that you can receive the best possible credit terms from suppliers and other businesses.
4. Open a business checking account. It's important to keep your personal and business finances separate, and a business checking account is a great way to do that. Plus, it shows potential investors that you're serious about your small business.
5. List your business on Google your business. Google is the most popular search engine and by listing your company on it, you're making it easier for people to find you.
6. Lastly, establish four tradelines credit accounts: Some examples of tradeline credit accounts are Equifax, business credit cards, online accounts like Uline, and gas cards. These accounts are accounts that are reported to the credit bureaus. They are important because they help you build up your credit score and make you look credible to banks.
By following these simple tips, you can get money for your small business without breaking the bank! If this seems like a lot of work there are companies out there set up to help you take care of all of this. Most importantly, get this done before reaching out to creditors.
Getting money for your small business doesn't have to be difficult or expensive! By following these simple tips, you can get the money you need to keep your business running smoothly! Thanks for reading!