Sometimes, no matter how hard you work or how dedicated you are to your business, there are obstacles that seem like they are going to be impossible to overcome. One of those obstacles often rears its head in the form of financing.
You’ve got great customers who you know will pay, but not right at this moment. When you’re first starting a business or attempting to scale, not having that cash on hand can be extremely problematic. You turn to more traditional forms of financing to supplement your cash flow and struggle to get approved or get the capital when you need it.
I recently spoke with Eyal Lifshitz, Founder of BlueVine, about this dilemma small business owners face and he had some interesting insights into the matter.
A Need for Alternative Financing Options
According to the Small Business American Dream Gap Report, 45% of small business owners who are denied financing get turned down more than once and 23% don’t know why their applications were denied.
When your customers don’t pay for 30, 60, or even 90 days out, it becomes too difficult to deal with the short-term game, let alone think about what your long-term plan needs to look like. As it becomes more difficult to procure lending from banks, small business owners have started looking for alternative financing options to help them cover business expenses.
There are a number of ways businesses can go about procuring capital. For business owners in need of short-term working capital to pay for everyday needs like payroll, marketing, inventory, and so on, these are some of the alternative options Lifshitz mentioned:
- SBA loans
- Term loans
- Larger equipment financing
- Lines of credit
- Merchant cash advances
- Invoice factoring
When you think about it, these are the expenses that matter most in the early life of a business. That’s why short-term financing options, and companies like BlueVine, are a great option for many small business owners.
You can listen to more from my full interview with Eyal Lifshitz down below:
Alternative Financing Options Reversing Small Business Cash Flow Concerns
Alternative financing options don’t just provide business owners with easier access to capital. BlueVine is a great example of this.
And that’s really the biggest draw for many of these options: the speed with which entrepreneurs can access the capital needed to keep their business running. Traditional banking lenders have to pull credit histories, and then assess and review them before making a decision. That’s not typically the case with online-based, technology-powered companies like BlueVine.
Lastly, there’s the objectivity factor.
So long as BlueVine’s machines run a risk assessment on a small business applicant and everything checks out, there’s very little standing in the way of them receiving the short-term financing they need.
It is BlueVine’s mission to help businesses succeed, and they do this by providing easy, fast, and convenient access to capital. Specifically, BlueVine offers lines of credit as well as invoice factoring. Lifshitz told me that he envisions expanding into additional products in the future, making BlueVine an all-encompassing product that helps business owners deal with everyday financing needs.
As operating expenses increase, business owners need help, now more than ever, to finance their growing costs. If you’re struggling with cash flow, alternative financing options may be just what you need right now.