One fifth of all businesses fail in the first year because they fail to access enough business credit. The lack of financing is the most common reason businesses fail. The most common mistake? Most businesses first go to the bank for a loan. What’s the problem with that? Conventional banks seek to issue low risk loans, where the business has years under it’s belt and seems a safer bet to issue a loan.
Most businesses are denied a loan at the bank. In the beginning, don’t bother with the bank. Start elsewhere, and approach the bank six months later.
When starting out, most lending comes from alternative lenders.
Alternative lenders usually specialize in certain types of loans for certain conditions or situations. For example, cash advance companies want the company to be at least one year old. They only handle revenue-based financing. Other alternative lenders offer extremely specific programs. You would only go to them for that type of loan that meet certain requirements.
Most lenders don’t loan as much money as they’d like because their programs require specific requirements. The issue is how to find as many as lenders as possible and apply to as many at once. But who has the time to do that?