Got Money?: Funding Options for Small Businesses

Small businesses have become America’s ventilator, pumping life into the economy by generating 64% of net new jobs over the past 15 years, according to the U.S. Small Business Administration. As a result, it seems like the whole nation is chanting, “Long live the small business,” showing their faith by generously funding entrepreneurs. Here, we’ve provided a list of 5 funding options and business solutions that could help your company get off the ground:

1. Venture Capital

Venture capital (or VC) is capital provided by a firm in exchange for equity, or an ownership share, in a company. According to data from research firm CB Insights, “Venture capital investments rose 19 percent, to $21.8 billion in 2010 — the first annual increase since the downturn.” And it looks like this kind of growth will continue. Rep. Renee Elmers projects that, “Venture capital participation will increase by nearly 45%” in the next year”.

With venture capital strengthening, it is quickly becoming one of the most efficient ways to get large sums of money, anywhere from $500,000 to $1 million. Usually these firms require a structured business plan, a formal presentation and a long process to get funding.

Disadvantage: Less control over your company

2. Angel Investing

“The beginning of 2010 to now, access to capital has really blossomed and a fundamental shift in angel investing has fully taken hold,” according to founder and CEO of UBER, Travis Kalanick.

Angel investing is much less structured than venture and is oftentimes sought after in the earlier stages of company development. Angels are typically individuals who provide capital in exchange for convertible debt or equity (like VCs). Angel investing, like venture capital, has experienced a recent increase: the number of angel investors has surged 22 percent in the last year, according to the
National Venture Capital association.

Disadvantage: Some angels require a percentage stake in your company, which can be costly, and you, again, will have to give up full control.

3. Debt Financing

Debt financing includes soliciting a bank for loans with a repayment schedule at a fixed interest rate. Banks often consider previous history with other financial institutions and entrepreneurial experience when dictating whether or not to issue a loan. The upside to debt financing is that you don’t have to give up equity and you can thereby stay in full control of your business. You may have to
provide collateral for the debt.

Disadvantage: Repayment, high rates, impacts on your credit rating

4. Grants

While many people think it is highly unlikely that they will receive a grant, it is always worth a shot. This funding option will, like VCs, require a rigid and organized business plan. Usually these grants can be found at the state level, but government operations such as the Small Business Innovation Research (SBIR) also provide grants. It can’t hurt to research these “free money” options.

Disadvantage: Hard to find, apply for, and acquire

5. Friends or Family

It may be a good idea, in the first couple of years of your business, to approach the people you trust most, like your friends and family, for funding before apply for venture capital or asking an angel. If you don’t need a ton of cash, friends and family could be willing to help you out. It’s always a good idea to write an informal contract for these exchanges so you can avoid conflict.

Disadvantage: Potential conflict

There are plenty of ways to acquire cash in the difficult beginning stages of company development. The important part is finding which one is right for you.

James Kim is a writer for ChooseWhat is a company that provides product reviews and test data for business services and products. Their goal is to help small companies make informed buying decisions on business solutions that help their business.

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The Best Copywriter Catch 22

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Best Launch Copywriter Reveals His Secret

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Have you seen this?

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How To Make Money Online

Is it all complete BS? Can people really make money online working from home? A lot of money? or just small spending cash?

I started attempting to make money online sometime around 1995-’96. I was 13 or 14. I didn’t make a dime until I was 17. I did it by taking my hobby (magic tricks), writing a short report teaching some of my favorites, using free software to turn it into a .pdf file, and selling it from my website.

Most of the tools I used back then are either no longer available… or I simply wouldn’t use them now. Here are the tools I would use to recreate that business…

Create A .PDF file: PDF files are the standard format when selling information. It’s getting easier and easier to create .pdf’s these days. Many programs can do it, but I use the Open Office Writer that is a free program similar to Microsoft Word. You simply write the report like you would write any paper, then click a button to quickly convert it to a .pdf file.

Domain Name: Your website will need a domain name. You can purchase one from either GoDaddy or Namecheap. I use them both and have had no problems.

Web Host: You’ll need a place to “point” your domain name to. That place is a “web host” where your web page files are stored. For this, I use MeWebHost. They have some extremely affordable options and great customer service, 24 hours a day.

Accept Credit Card Payments I’ve used Paypal to accept credit card payments for close to 8 years. There have been a couple problems during that time, but for the most part they’re the best way to get started accepting credit cards online. (And it’s free.)

Of course there’s more to it than just these 4 resources. You’ll need to actually write the report, create an advertisement for it, and start sending traffic to your advertisement. But we’ll get to that soon.

In the meantime, remember to bookmark this blog or subscribe to the RSS/email announcement lists.

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We’re Moving To

I’m changing my domain name for this blog. You can find new posts here:

I decided wasn’t the best domain for my business. My name (Stephen) is kind of hard to spell. Many people spell it wrong. And it’s spelled differently than it sounds.

Continue reading »

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Change Of Rules, Links “Do-Follow” After You Make 5 Comments

A few days back I told you how to increase traffic to your website using my blog.

The 4 point plan was to exchange links with me, comment on my posts, link from a post of yours to mine and to follow me on Twitter.

Many of you did these things and I greatly appreciate it. I’m also glad to see you’re being proactive.

But I am disappointed with 2 things.

One, no one has exchanged links with me. I know, cry me a river. But I’m really trying to make this WordPress Link Directory work. My next post will be on how to set it up on your blog just in case you’re unsure how to do it. And then hopefully you’ll exchange links.

Two, some of the comments that have appeared since I invited you to comment for SEO reasons have been, I guess predictably, skeptical. There were a couple that forced me to make a decision on whether or not they were spam or legitimate comments by a reader.

I want people to get some link love back to their sites, but I also want comments that constructively add to the conversation.

So here’s what we’re going to do.

I’ve changed the “DoFollow” plugin I’m using. It’s now Lucia’s Linky Love and it only changes your links from “nofollow” to “dofollow” after you’ve made 5 comments. This will protect the blog from drive by commenters.

At some point, I may raise the barrier to 10 comments before you receive link love from me. But for now it’s 5.

Now I don’t want you to leave a bunch of “junk” comments in order to hit the 5 comment barrier. So if you don’t have 5 comments yet, don’t worry! You can still get some link love from me by exchanging links in the link directory 🙂 It’s here:

And if you want to start boosting your comment count now, why not let me know what you think about this policy? Leave a comment 🙂

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The Formula For Failure

One thing I make an effort to do is to collect failure secrets. Because if you know how to fail you know how not to fail.

Justin Brooke just wrote a great blog post called “The Formula For Failure.” It shares several failure secrets. Check it out!

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Sales Letters That DONT Work.

My brother has a great lesson for you on sales letters that DONT work.

He just got a new golden retriever puppy. Talk about cute.

Growing up our golden retriever once had 13 puppies that we got to watch grow up. Watching them walk out of the dog house one by one, single file and line up in front of the fence was an AMAZING experience.

Speaking of amazing experiences, have you ever had to potty train a puppy? Oh boy, that’s what my brother is dealing with now.

The last time I was visiting he told me he searched Google for how to potty train a dog. And he was having trouble finding an answer.

He did find one page and this is how he described it…

“I was reading it and it kept talking about all this stuff I didn’t care about. Then they were trying to sell me a bunch of different products and all I wanted was some tips to potty train my dog.”

I knew right away that he had found a sales letter. And one that did NOT work.

I decided to trace his steps so I could learn from the process.

* He searched Google for “how to potty train my dog.”

* He clicked on a sponsored link that is ABOVE the search listings, without knowing it was an ad.

* He read or skimmed most of the copy… even though that meant clicking through 3 different pages… and even though he didn’t understand why they were telling him all this unnecessary information. (It lacked a clear logical argument that mattered to him.)

* He saw a ton of bonuses (which were unnecessary) and thought they were trying to sell several products, when all he wanted were some tips to potty train his dog.

* The order link was finally on the third page, but with no call to action.

* He didn’t buy.

I have no clue why the site owner made the prospect click through 3 pages. Sometimes I’ve seen this done strategically with good results, but this was done very poorly and hid the solution my brother was looking for.

Lesson #1: Keep your sales copy on one page unless you have a good reason.

Lesson #2: Make sure to craft a strong logical argument in the copy that FLOWS from the conversation going on inside the prospects head… and not a logical argument that flows from the copy formula you saw someone else use once for a product in a completely different niche.

Lesson #3: You don’t need to have 10,000 bonuses ever. And you don’t need to have a half-dozen bonuses when your prospect is trying to solve one specific problem. You’re just confusing the prospect.

Lesson #4: Your copy can’t just give a couple compelling arguments for why they should buy, then drop them off at an order link. Finish the job. Build up the value of the product. Explain why they’re getting a good deal IF they act now. Then tell them how to act (usually clicking an order button).

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New Blog Theme At

Hi guys and gals. I’ve been quietly piecing together a new wordpress theme in between copy projects this week. It’s based on Versatility Lite.

What does everyone think? Please leave a comment.

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