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    6 Replies Latest reply on Jul 16, 2010 12:35 PM by surepayguy

    Where do I find less than $20,000 in working capital?

    SASURBER1954 Newbie

      +My business partner and I are looking for $19,000 in working capital. We own a mastectomy and cancer care boutique that caters to breast cancer patients or anyone who is undergoing chemotherapy or radiation. We started the business in July 2008 and used our own personal money to open the business and purchase store equipment and inventory. Now that we have a good idea of the actual value of our business, we want to increase and diversify our inventory and advertise more. Does anyone know who will loan such a small amount? Also, can anyone advise us on what terms are fair for such a loan? +
        • Re: Where do I find less than $20,000 in working capital?
          LUCKIEST Guide
          Where do I find working capital? Welcome Sheila

          If you want to find working capital, you need a business plan.

          Do you know about SCORE?? SCORE is FREE and can help you with a business plan

          Good luck, LUCKIEST
            • Re: Where do I find less than $20,000 in working capital?
              SASURBER1954 Newbie
              +Hi,+</stro<br />Thanks for your interest and response. We wrote a business plan before we opened our business. It was pretty difficult because we had no local competition to be able to determine the atmosphere of the local market. It turns out that we created a local niche business that caught on and was successful rather quickly. However, we made some wrong decisions at the beginning that cost us (mostly by following wrong advice from our vendors) but we have learned from our mistakes and we know it is time to get out the old business plan and revamp it. In the meatime we still need to borrow $19,000 to accomplish our goals and continue helping our customers. *
            • Re: Where do I find less than $20,000 in working capital?
              phanio Pioneer
              There are a couple of ways:

              First - if you or your partners have good credit - you can seek a loan from a business or personal non-bank lender - these loans are unsecured.
              Second - you can use the equipment you already have - sale that to a equipment loan or lease company for cash then lease the equipment back or take a loan against it - this is just a paper transaction - you don't have to take the equipment to them.
              Third - there are either micro-loan companies (try ACCION USA) or peer-to-peer socail lending sites that can help.
              Lastly, if you have some financial assets - like accounts receivable (even medical billing claims) or credit card receipts - then you can factor them for the money you need.

              More information about all of these on our website.

              Business Money Today
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              • Re: Where do I find less than $20,000 in working capital?
                dltmgmt Newbie

                Some banks are still doing unsecured or secured business line of credits up to $100,000. The requirement is to have decent credit because you as an individual will be the guarantor, and also show that you have been profitable on your tax returns. Another way, you can do what is called a quick loan. A quick loan is secured by business assets.
                • Re: Where do I find less than $20,000 in working capital?
                  Uncle Leon Tracker
                  If you have a good banking relationship, a signature bank loan should be available. If not, the SBA has a "micro Loan" program. Find an "SBA preferred" bank.
                  • Re: Where do I find less than $20,000 in working capital?
                    Wayfarer
                    "Fair Terms" on a loan is completely subjective. What I would consider fair is what is most advantageous to your plan. Certainly consider some of these factors and make sure you ask the loan officer what each entails:
                    • Origination Fees
                    • Repayment time frame
                    • Compounding interest policy
                    • Early payment penalties
                    • Collateral
                    • Balloon repayment vs. fully amortizing
                    • Ongoing loan maintenance costs
                    • Default penalties
                    • Lien covenants
                    • Refinancing options

                    Some practical options to look into are:
                    • Merchant Cash Advance providers : If you accept credit cards, companies like Sure Payment Solutions (www.surepyamentsolutions.com) can provide alternative financing
                    • OnDeck Capital: Short term micro lender (www.ondeckcapital.com)
                    • Bank line of credit: $19,000 line of credit should be attainable
                    • SBA backed loan: sba.gov
                    Hope that somewhat helps.

                    -Sean