Need help with your business finance? Finding the right type of business finance doesn’t need to be difficult. Read on to see the 5 best types of finance available for your business. 

Cash flow lending

This type of finance is usually a short-term loan, available form a variety of payday loans direct lender sites. Cash flow loans can help you maximise a business opportunity or manage a cash flow. Features of cash flow lending can be inclusive of faster applications with less paperwork, cash flow generous repayment period and real transparency surrounding the total amount that is eventually repaid. Not all lenders are equal, and some will not offer a fixed upfront price, meaning you may be susceptible to higher interest rates, hidden charges, and unclear fees. 

Invoice finance

Invoice financing can help smaller businesses maintain cash flow when waiting for customers to pay. There are two types of invoice financing, which include:

• Invoice factoring
• Invoice finance

Some forms of invoice finance provider offer 100% of the total invoice value, in exchange for a drawdown feed along with continuous weekly interest rates. Invoice financing can be useful if you have to wait for payments once a project has finished. 

Angel investors

Angel investors are usually owners of businesses, or individuals with a high net worth. Angel investors see the potential of a business, and therefore involve themselves financially. Often, they will invest in industry sectors in which they have familiarity, targeting big returns on their investments. Their involvement can be structured in numerous ways, such as a loan, equity, or a combination of both. 

More often than not, angel investors will come on board in the very early stages of a business, contributing their knowledge and experience in addition to funding. It can be important to put careful consideration into choosing an angel investor who has the ability to add value to your business, while sharing the same vision when it comes to your business values. Always do your research if you decide to involve yourself with angel investors, and make sure they are the right fit for your business requirements

Venture capitalists

Venture capitalists, or “VCs” are investment companies, or fund managers, who can often have the ability to provide money in return for part ownership of your business. VCs will tend to look at larger businesses, which sets them apart from angel investors.  They may not want to play too much of an active role in the business, but instead will take a seat on the board of your business. 

Crowdfunding

Crowdfunding is consistently increasing in popularity and is incentive and reward based. Here, a “backer” will pledge money to support your business in exchange for a discount within the business. Upsides of this include the fact that business owners can retain full ownership of their product, while clients merely invest.

Crowdfunding may suit businesses just starting out rather than well-established business. Additionally, this may not be an exceptionally viable solution if you require intense help managing your cash flow.