After getting their businesses off the ground, most small-business owners start focusing on growth. The main challenge that most of my clients face when they’re ready to grow is finding the money that allows them to do so.
Here are some strategies for finding the capital you need to take your business to the next level. Of course, not every strategy will work for every business model, but these should at least help you see the options available.
- Diversify your offerings. If you’re primarily serving single clients, consider working with groups as a paid speaker or columnist. You might even expand into hosting seminars, workshops, or training sessions. (Hint: even if you’ve left the corporate world for good, don’t ignore corporate offices as potential clients that might benefit from the services or skills you can teach!)
- Find hidden goods to sell. Service-based entrepreneurs often overlook the products they could be selling to increase their revenue. If you’ve recorded several webinars or presentations, for example, consider packaging them as a CD and selling it. Or you could license and sell a product you’ve developed for your company. Some businesses might even be able to expand as franchise operations.
- Start teaching or training others. Pull in extra funds by training others in the skills you already have. This may require you to earn additional certification, but if the audience is there, you may be able to pull in enough additional income to expand your business.
- Consider your loan options. If you need an injection of cash quickly, loans might be the way to go, even though you’ll have to repay them with interest. The Small Business Administration, Small Business Development Centers, and Community Development Financial Institutions all offer loans targeted to small-business owners. Alternately, you could consider financing with microloans or with asset-backed loans, which might allow you more flexibility than government-sponsored funding sources.
- Lease equipment. If the only thing keeping you from growth is state-of-the-art equipment, consider leasing the machines you need. You can get the benefits of high-caliber technology without the investment of purchasing it.
- Dip into your retirement funds. While raiding your 401(k) may come with serious tax penalties, it provides you a source of financing you don’t have to repay on anyone else’s schedule. Of course, the risks associated with sapping your retirement account are numerous, so make sure you’ve thought through all potential consequences before taking this route.
- Put it on a credit card. If you’re not already maxed out on credit lines, growing your business might be a worthy cause for taking on more debt. Again, be sure you have a solid plan for increasing future income.
- Hire a mentor. True, this step requires you to spend more money in the short term. But if you’re serious about finding areas for growth and committing to expanding your business in the long term, working with a high-level mentor will save you time, money, and the mistakes that cost you both.
Remember: when you have a goal to grow, your growth will only be as successful or as limited as you let it be!