| An aspiring entrepreneur’s guide to financial woes |
 When one thinks of starting a business, only one word comes to mind---capital. There are a lot of people with a lot of brilliant business ideas and the entrepreneurial skills needed. However, they are intimidated with the thought of coming up with enough financial resources for a start up on their entrepreneurship. True enough, it is not easy to gather a sufficient amount of capital; it is not impossible either. There are many ways to finance your business. However, be aware of the following myths regarding financing your business. It takes a lot of money to finance a businessThis is one of the myths that Shane Scoff, a professor of Entrepreneurship Studies in one of the universities in Ohio, mentioned in his list. He said that $25, 000 is enough for a typical business start up.Especially if it is your first time to venture in a business, the best way to do so is to start small. And a $25,000 (or any amount close to that range is enough to make your business up and running. Mary Kay started her business with an initial capital of $5000. If we convert that to what it amounts to for 2008, it’s $35,754.08. Look where Mary Kay Inc. is now. Of course back then, the market was different. The point is, you do not really need a really big amount of capital to get a start on your entrepreneurship. Starting small in your first experience as an entrepreneur is the key so that you do not get overwhelmed with the operations that are involved in your business.
It is better to borrow money from big banks than small banksContrary to many aspiring entrepreneurs’ beliefs, it is actually more advantageous if one borrows from a small community bank if you are just starting on a business. Jill Fraser, a finance editor for Inc.com talked of the advantages of smaller banks. In her article, she talked of how big banks these days act more cautious to businesses asking for financial back-up despite the client’s good standing with them. Community banks on the other hand are likely more proactive to starting entrepreneurs. More so, it is easier to develop a personal relationship with a loan officer and key bank personnel in a community bank than with people working in big financial institutions. According to a survey by financial services firm Grant Thornton, 73% of community banks see small businesses as an essential part to their growth. Community banks are more willing and considerate in helping small businesses grow and they take time to listen to an entrepreneur who is still starting on a business.So, when you have thought of a brilliant business idea, do not feel overwhelmed first with the start up costs. There are many ways to find capital source. The first thing you need to do is work on that brilliant idea of yours. Make a really organized business plan. A banker wants to know the details of your plan especially your business potential before he lends money. In addition, as Peter Dahl, president of Crown Bank says, banks also focus on other issues like a borrower’s character. It does not guarantee that they will immediately satisfy your needs but it will make them listen.
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