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Archive for the ‘Finding Money to Start a Business’ Category

Small Business Owners Should Use Credit Cards with Caution

Posted on August 2nd, 2011 by The BizFilings Team
Category: Cash Flow, Finding Money to Start a Business, Small Business, Small Business News

Many small business owners are reluctant to open business credit cards because they are unaware of which are the best choice. Because of this,  CreditDonkey recently released a list of the best business credit cards in an effort to help small business owners realize a corporate debt ceiling plan.

“Even if a small business isn’t currently in need of credit, opening a business credit card is a smart move,” said Charles Tran, owner of CreditDonkey. “By utilizing a small business credit card, business owners can help ensure their companies have access to credit when it’s needed.”

A business credit card can help small business owners build their company’s credit, have access to additional cash, and potentially utilize cash back rewards savings. Another benefit is not having to pay the unnecessary fees that sometimes come with business loans.

While opening a small business credit card may be convenient, small business owners must be responsible with the use of their cards. According to Debtmerica.com, a majority of the nation’’s 27 million small businesses use credit cards as a main money source.

However, more businesses than ever are failing to pay their credit card bills and are allowing their balances to grow between $10,000 to $25,000, according to an upcoming report from the National Small Business Association.

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Michigan Small Businesses Appear to Be On the Upswing

Posted on July 11th, 2011 by The BizFilings Team
Category: Cash Flow, Financial Services, Finding Money to Start a Business, Grow a Business, Small Business, Small Business News

Despite the economy’s rough nature, small business owners in Michigan are optimistic things will soon be moving in the right direction. Of the 600 business associates that were interviewed for this survey, over half believe the business outlook over the next six months is “good.”

The survey, conducted by Accident Fund Insurance Company of America, found that investments going into business grew 8 percent. Michigan business owners can finally breathe a sigh of relief after fighting through the difficult recession.

Hiring and layoff numbers are also expected to improve. Sixteen percent of business owners expect to hire new employees in the next 6 months, and 20 percent plan to increase wages.

More good news for Michigan small businesses owners is the new initiative by Representative Gary Peters to provide a Farmington Hills bank with over $11 million to lend to small businesses. The fund was created by the Small Business Jobs Act, in which Peters was a main influencer.

“This program will put our investment where it will create the most jobs: helping community banks make crucial loans to small businesses here in Michigan,” said Peters.

The bank receiving the funds will be Level One Bancorp, and the funds will lead to over $100 million in new small business lending in southeast Michigan.

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Clean Technology Business Competition from Cleantech

Posted on June 29th, 2011 by Joey Donovan Guido
Category: Cash Flow, Finding Money to Start a Business, Green Businesses, Small Business, Small Business News, Start A Business, Work For Myself

http://www.bizfilings.com/blog/wp-content/uploads/2011/06/Green-Light-Bulb-iStock_000009200146Small.jpgDo you have a fantastic clean technology idea? Cleantech wants to hear about it. They’re running the world’s largest clean technology business competition and they’re looking for the best clean technology ideas from around the world.

Just share your idea, and you could win a prize package of services worth $100,000 to help you start a business and make your idea a reality! To enter, visit the Cleantech Open contest page.

If you win the National Competition for your country, you’ll become a Global Ideas finalist at the annual Cleantech Open Awards Gala on November 10, 2011 in San Francisco.

During the awards gala, you’ll be given the chance to present your idea in front of a crowd of 2,500 investors, entrepreneurs, sponsoring companies, corporations, members of academia, press and others interested in hearing your ideas and getting involved.

The crowd will then vote via text message to decide the “People’s Choice,” and the winner will receive $100,000 in marketing support, legal advising, conferencing services and more to help launch their business!

Clean technology categories include: Air water and waste, energy efficiency, renewable energy, green building, smart power, green grid, energy storage, and transportation.

For more information on categories, eligibility and funding limits, check out the Eligibility and Rules page.

The contest deadline is September 12, 2011.

Good luck!

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Small Business Credit Demand Expected to Rise in Coming Months

Posted on May 31st, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Lines of Credit, Small Business Trends, Start A Business

Many analysts have pointed to community banks’ lack of interest in tapping the national Small Business Lending Fund as indicative of the overall state of the credit market, with lending stalled due more so to weak demand than tighter policies.

But as companies emerge from the recession and seek to expand their operations through hiring, marketing and equipment investment, the demand for credit is expected to grow as well.

As Maria Coyne, executive vice president of business banking for the Cleveland-based KeyBank, recently explained to Entrepreneur magazine, small firms are actually borrowing to afford additions to their payroll.

“[Small businesses are] also taking advantage of existing opportunities,” Coyne told Entrepreneur. “Perhaps they’ve explored other ways to sell their products or services or expand into new markets and now they need to borrow to bolster their inventories. Maybe they’re taking advantage of existing tax credits to purchase heavy equipment that can help a company be more efficient.”

But underlying these market trends is consumer activity, which is often seen as the principle driver of sales, hiring and investment. With the most recent Thomson Reuters/University of Michigan Consumer Sentiment Index showing a three-month high in May, analysts may anticipate credit market growth in coming months.

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Small Businesses Still Prefer Bank Capital Over Alternatives

Posted on May 23rd, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Small Business News, Small Business Trends, Start A Business

Last Friday marked the conclusion of National Small Business Week, wherein business leaders and government figures took efforts to champion the role of small companies in promoting job growth, entrepreneurship, innovation and general economic prosperity.

A favorite figure thrown around by the U.S. Small Business Administration, which sponsored last week’s activities, is that small firms contributed nearly two-thirds of all jobs created within the past 15 years. The sector also currently employs nearly half of all private workers.

“From the family businesses that anchor Main Street to the high-tech startups that keep America on the cutting edge, small businesses are the backbone of our economy and the cornerstones of America’s promise,” said President Barack Obama at a commencement ceremony in Washington, D.C.

“Throughout our economic recovery, persevering small businesses have helped put our country back on track,” he added.

However, the celebration of small firms belies a number of deep-rooted challenges – namely that of access to financing opportunities.

The Capital Access Network released its latest Small Business Barometer this week, shedding light on how small businesses are obtaining working capital and their preferred methods of doing so.

Banks remain the most sought after source of financing, with 43 percent of small businesses claiming banks to be most desirable. But interestingly enough, only 34 percent of respondents reported turning to them as their first choice. Alternative providers and credit were cited as first choices nearly as much as banks.

“Small businesses must be vigilant in exploring alternative finance options,” said Glenn Goldman, CEO of CAN. “While traditional bank loans may be preferred, they may not be the most available or best option for Main Street businesses. New products and features are making their way into the marketplace and are often a better fit and easier to access.”

However, the study does little to settle the question of how much small businesses are affected by the credit crunch. Nearly a quarter of respondents reported that they have been rejected by banks for loan or credit card applications, but with other groups such as the National Federation of Independent Business stubbornly maintaining that over 90 percent of small businesses are meeting their credit needs, those figures do little to suggest otherwise.

At the end of the day, entrepreneurs forming a company are likely to face varying credit conditions that depend on location, industry and outlook.

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The Role of Passion in Growing and Financing a Business

Posted on May 10th, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Grow a Business

Entrepreneurs, almost by definition, have a dedication to their businesses – they see them as extensions of themselves and, thus, have a relentless zeal to pursue them until success is achieved.

However, this same degree of passion that allows entrepreneurs to devote so much of their time and effort can be something of a double-edged sword, as passion gives way to bias or poor judgment.

“There are two sneaky things about the passion trap, it tends to operate at a subconscious or unconscious level, so we’re often not aware that these cognitive biases or these filters are at work, and we actually believe that the world or the marketplace is confirming our thesis about the business,” author and investor John Bradberry told Inc. magazine.

With startup activity at a 15-year high, according to the Kauffman Foundation, the need to have a balance between passion and objective judgment is essential, especially with financing strategies difficult to grasp.

A recent study by Hiscox USA found the underestimation of monthly expenses to be the primary mistake made by entrepreneurs forming a company. While financing seems to be a fundamentally mathematical aspect of launching a company, the mishandling of it can be routed in passionate assertions that a business will sell itself or survive on its own merit.

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JPMorgan to Hike Small Business Lending as Credit Market Remains Debatable

Posted on April 28th, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Grow a Business, Lines of Credit, Small Business News, Start A Business

JPMorgan Chase, the nation’s second-largest bank, announced Tuesday it will boost its lending to U.S. small businesses by 20 percent this year, marking a volume of $12 billion in credit to the sector.

“Small business owners are not only our neighbors but also the entrepreneurs that hire half of the employees in the United States,” said Michael Cleary, CEO of business banking in retail financial services. “It’s critical that we support small businesses as they continue to fuel the economic recovery across the country.”

Chase, the banking sector of the financial service giant, increased its first quarter lending to firms with less than $20 million in annual sales by 64 percent. Last year, the bank became the No. 1 distributor of Small Business Administration-backed loans.

There has been debate in recent months over the state of the credit market and its impact on small businesses, with some groups, such as the National Federation of Independent Business, asserting small firms consistently achieve all of their credit needs. In fact, the NFIB reported that 93 percent of small businesses met their lending requirements in March.

Others, such as Federal Reserve Governor Elizabeth Duke, have argued that the issue is actually much more complex. In a speech earlier this month, Duke reasoned that perceptions of poor credit have actually discouraged firms from even applying for loans, thereby improving the acceptance rate but limiting distribution.

“Many small business owners were so convinced that their requests would be denied that they did not even apply for credit,” Duke said. “Despite this restricted credit availability, small business owners, by a large margin, still considered their most significant problem to be weak sales.”

However, Duke maintained that conditions are expected to improve in coming months, as private lenders and banks like JPMorgan Chase embrace greater levels of risk. Consumer spending and overall confidence will also help to stimulate the sector.

Still, other analysts, like Wall Street Journal contributor Angus Loten, have argued that banks are only lending to top-tier small companies and startups, while average-income firms have been struggling to access credit.

“Recent surveys of small-business owners suggest that lenders are targeting only the most credit-worthy businesses,” Loten wrote in a February article. “Such firms tend to be at the upper end of Bank of America’s $20-million threshold for small business, if not well beyond.”

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Small Banks in Delaware Less Likely to Fund Small Businesses

Posted on April 19th, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Lines of Credit, Small Business News, Start A Business

The rate at which small banks in Delaware hand out initial financing for small businesses in the state has decreased sharply in recent times, the News Journal says.

This means that new players have stepped into the void left by those smaller local institutions, the newspaper reports, naming Bank of America and Wells Fargo as two of the biggest players in the market, and adding that the the presence of non-bank lenders and community development funds has also increased.

The state’s WSFS Bank underwrote $3.9 million in small business loans in 2008, according to the News Journal, but that figure fell all the way to $782,00 just two years later. Small Business Administration loans have also begun to dry up for those in the process of starting a business.

Fortunately, the SBA avoided the budget ax that many had feared in the run-up to the last-minute compromise measure earlier this month that averted a government shutdown. The administration even received $25 million back that had been removed by congress in February.

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Amex: Small Businesses Ready to Come Out of their Shells

Posted on April 19th, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Internet Marketing, Small Business News, Start A Business

More than half of U.S. small businesses are willing to take a financial risk in order to grab more market share – a possible sign that the U.S. economy is recovering further from the recent recession, American Express’ OPEN Small Business Forum reports.

However, the survey, which measured small business owners’ views on economic conditions for the coming year, did notice significant differences in outlook between those who reported doing well and those who said they were struggling. For instance, successful business were more likely to be marketing themselves on social networks and providing benefits to their employees than businesses trying to keep the lights on.

Roughly 37 percent of business owners surveyed expected their companies to grow in 2011, and nearly two-thirds of those reported that they believed the pace of said growth would be slow and steady.

This gradual economic recovery may mean it’s time for small businesses to take the next step and form an LLC in order to set the stage for expansion, experts say.

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Fed Governor Aims to Settle Small Business Credit Dispute

Posted on April 15th, 2011 by The BizFilings Team
Category: Finding Money to Start a Business, Grow a Business, Small Business News, Start A Business

Progressing a number of recent comments and studies from public officials, Federal Reserve Governor Elizabeth Duke asserted that financing conditions for the U.S. small business sector are likely to continue to improve in coming months.

Duke referenced a number of recent surveys that seem to contradict each other, with some arguing that small businesses’ biggest problem has been a lack of available credit while others blame weak sales for the problem.

The real issue, she asserted, is more complex than either, in that lending to the sector has been troubled, but perceptions of the credit market among small business owners has discouraged them from even applying.

“Many small business owners were so convinced that their requests would be denied that they did not even apply for credit,” Duke said in a speech Thursday. “Despite this restricted credit availability, small business owners, by a large margin, still considered their most significant problem to be weak sales.”

However, she added, conditions are expected to improve as banks and other private lenders become willing to embrace greater levels of risk. Additionally, consumer spending and overall confidence – both of which have shown recent improvements – will also help stimulate the sector.

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