If you are looking to fund a new business in the future, there are two ways to go about this, speaking generally. The first way is to seek out venture capital from investment groups, or through Angel investors. This can be a good option for many new business owners, since it affords you the opportunity to collect capital without having to worry about payments on a loan. Of course, the disadvantage is you have to give up some ownership of your company. Business loans, on the other hand, offer you 100% ownership. However, you will have greater risk. We will discuss this in detail, in today?s article.
First, we?ll start on the topic of business loans. These can be a very appealing option to many new entrepreneurs, since new owners tend to not want to share their vision with partners. In fact, it is quite possible to have venture capitalists end up with controlling share of your company, depending on how much funding you need.
On the other hand, if you fund your entire venture through business loans, you take on one additional risk. For one, you?ll have to worry about making loan payments on top of your operational costs. For new companies, this can be very cost prohibitive. It is not uncommon for new venture to be unprofitable for a year, or more, as they gain market share.
Although business loans may have emotional appeal for many people, they are not always the best option from a business standpoint. You should look over your financial planning statements to determine if you can carry the extra burden of borrowing money in the early stages of your company. If not, you should consider looking for outside investment instead.
For more information, go to Business Loans at http://www.creditnowusa.com/Business-Loans
Source: http://www.creditnowusa.com/Blog/posts/business-loans-vs-venture-capital/
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