Over its entire history, the U.S. patent office has issued more than 10 million patents, accounting for untold numbers of businesses and ventures. While one business could have a ton of ideas that lead to patents, some might have just one idea that that lead to dozens of businesses making the product.
Financing a business is probably the only hurdle that stands between a successful business and one that never gets off the ground.
Here are five tips for getting yours going even with poor credit.
1. Sell Your Assets
If you want to finance your idea but don’t have good credit, one of the best routes is to be able to fund it without any kinds of loans. If you already hold on to some assets, you can fund your business with what you already own. If you own any assets, you can sell them to pay for the business idea that you want to start.
Selling your assets is a great way to get unload things that might not bring you much value anymore. It’s also the reason that you invest in assets in the first place. Investing in assets is meant to help you reach your financial goals and if your business idea is meant to help you get to those goals, then it’s worthwhile.
Selling assets could mean selling jewelry that you don’t wear or that you inherited.
It could also be more complicated, like selling property, vehicles, or an estate that you’ve been holding on to. If you don’t have enough money to hold on to these assets anymore, it might be worth your while to get rid of them.
2. Collaborate With a Financer
Talk to any business team and you’ll find that there’s usually one person who handles the money well and another who is the “ideas” person. While they might not always see eye to eye, they agree that they wouldn’t be able to function without one another.
It’s common for someone to work with a financier or investor. If they support the idea, they get the chance to buy in early and own a portion of the company. If this isn’t preferable to you as the idea person, you can agree to pay them off at a later date with added interest.
Either way, you’ll get your idea funded and they’re sure to make money. Just make sure you have someone look over the contract. You don’t want to end up handing over your business to your financier after you’ve done all the hard work to build it up.
3. Sell Your Idea
If you want to make some money off of your idea fast, there are lots of companies who might find value in it. Even if it’s not as big as what they do, they can add it as a component of what they’re already doing. Even a well-crafted feature can make a successful application, product, or tool even better.
There are dozens of patents for coffee lid designs out there that you might not have ever even realized. Even tiny little changes can make a difference in how a seemingly flawless product functions.
Put together a pitch on why a company should buy your product. Be clear and concise but come prepared with information that can provide further detail on what your idea does.
Make sure that you pitch to companies who would find your idea useful and who would have no trouble marketing it at all. This will ensure a speedier sale.
4. Seek Out Bad Credit Loans
While you might think that all hope is lost for you when it comes to loans, it turns out that you could actually still get a loan.
If you have collateral to put down, you could be able to get a loan at a reasonable interest rate. If you only need a small amount of money for a short period of time, you could get a payday or an auto title loan.
People with poor credit aren’t cut out of every opportunity to get a loan. However, it’s going to be more challenging when you have poor credit. You need to be able to prove that you have some financial responsibility or something for them to hold you to.
If you’ve been banking with a financial institution for years, you might be able to get a loan based on your relationship to the bank or credit union. If you have bad credit with other organizations but you have good credit with the financial institution that you work with, that might be good enough.
Check out the Bonsai Finance website. They have options that suit any financial situation.
5. Borrow From Friends and Family
Borrowing money from friends and family might not be an option for you.
However, if you have friends and family who are in the world of business, they might be the perfect people for your idea. If they are the exact market for the products that you’re designing, they might be the perfect people to start funding you.
When you involve money in your personal relationships, it’s challenging to keep things from getting hairy. When you owe someone you know and love money, it can be awkward.
However, if you draw up a proper contract and abide by it, everything might be a-ok.
Financing a Business Is Hard Without Help
While some people are independently wealthy and can start any business they choose, most of us need help.
Just because we’ve got poor credit doesn’t mean we don’t have good business ideas that need to get out there. Once we secure financing for a business, the only way to lose is to have a bad idea.
Once it’s time to market your business, follow our guide to getting things started.