This is a series for new-age business founders looking to raise capital. It will help you figure out:
the best way to fund your growth.
the equity-free options available to you
How Debtworks makes alternate finance accessible and easy.
As a founder, the equity dilemma is one of the most important factors to consider when looking for capital to grow your business.
Why? Because equity means ownership in your business.
But first, what exactly is equity, and is it right for you?
When you raise equity, you are selling shares of your business in exchange for money to fund your growth. Each time you raise a round of funding, you will lose a little more ownership of your company (known as dilution). After multiple rounds, you may be able to own less than 50% of your company as a founder.
Most entrepreneurs view equity financing as the best and most common form of raising money for their startup. Equity financing involves the typical pitching to investors and venture capital firms to raise money in exchange for equity in your company — the stuff you frequently see on TV and read about online. However, that’s not the only way to raise money for your company.
The thing is, while VC funding can be rocket fuel for your business, it isn’t ALWAYS a great fit — especially at the later stages. Which is where other forms of non-dilutive funding come in.
Let's take baby steps... Shall we?
Debt Financing For Startups: What You Need To Know
What is debt financing?
Debt financing is money that you have to pay back. This can take the form of a loan, a line of credit, a credit card, or a merchant cash advance
What companies are best suited for debt financing?
Lenders work with companies that can make a compelling case that they will repay their loan. The revenue comes from either
(a) past performance, a track record of consistent business revenue,
(b) future revenue, such as government contracts, purchase orders, subscriptions, or receivables.
What are some of the other options available to fund your company?
There are three major categories of funding:
What are the advantages of using debt financing?
The advantages of debt funding are speed, flexibility, and access. Equity fundraising can require months of meetings and pitches, and crowdfunding campaigns typically last 30 days, but alternative finance lenders like Debtworks can offer funding in just a few days. Debt financing is flexible to your needs — Let's say you’re buying a truck for your company, there are specialized solutions to fit your need. Alternate financing finds ways to unlock the value tied up in your business that traditional funding methods can't.
Because one size doesn't fit all.
What's more, is that debt funding is accessible to far more companies than equity or crowdfunding; no VC pitches or crowdfunding PR effort is needed.
Where do you go to receive debt financing?
In addition to traditional channels like banks, many new-age fintech companies have emerged to fill the gap with fast financing options.
How does Debtworks fit into this picture? What sets us apart?
Through alternate financing, we'll identify the pain points and enable you to raise working capital without diluting your business.
We'll ensure that the funds are transferred in a couple of days.
We'll enable you to retain control of the company's operations and direction.
We'll tailor-make a Debt Solution and enable debt raise in a quick and hassle-free manner.
With the ecosystem we've built over the years, we're able to offer competitive rates
In a nutshell, we’ll make debt work for you.
You made it to the end… but this is just the beginning!
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