When most of us think of business funding, and start-up capital to fund our business plans, we think of traditional bank loans, venture capital, business grants, or angel investors. There are, however, alternative methods of business funding that most people do not even realise are an option, and in this article, we look at what they are.

Micro finance

If you are only looking for a small amount of start-up capital, then microfinance may just be an option for your company. Micro lenders typically lend out smaller amounts than banks or traditional financiers, and while they do charge more interest, they are also more likely to offer finance to higher risk individuals.

If you do opt for micro finance as a method of business funding, minimise the interest costs by borrowing as little as possible to get your business started, and try to accelerate your repayments.

Starting a Service Business First

It is a fact that service businesses (like consultancies, independent contractors and others) require less business funding to start than manufacturers or retailers. Whatever your business field, look for opportunities in your industry to start a service business that you will use to build up the capital you need to start your ‘real’ company. Offer consulting services to people or companies in your industry, or create a digital product, that you can sell to earn the capital you need.

Start In Parallel

Starting a business in parallel to your day job is probably one of the hardest things you can do. You will feel like you are working 24 hours a day (and some days, you might be.) However, it is possible to get a company started while you are still working, and earning a salary, and if you cannot find any other sort of business funding, then it might be an option.

Cut Costs

Another idea, if you are still planning your business, and looking for funding, while you are working in a salaried job, is to cut costs, and save the surplus to fund your business.

Most people can downgrade their car to a smaller, less flashy model, or rent a smaller home. You can also adjust your lifestyle, shop around for cheaper insurance, entertain at home, and look at other ways to cut costs. For many people, doing this can free up a significant amount of money over time, and if you are saving that money for your business, you should have at least some of your business funding by the time you are ready to launch.

Negotiate With Suppliers

If you cannot find business funding in any other way, negotiating with your suppliers is always an option. If you can secure 30 or even 60 days credit with your suppliers, that’s like money in the bank. You will have time to sell those items, and make a profit, before you have to pay them for their products. In many cases, this kind of vendor financing is the quickest and easiest way to fund your start-up, and it can be a good idea even if you have some capital to work with!


Bootstrapping is a term that describes small businesses that get start without any outside funding at all. It is tough, but it does mean that you get to maintain complete control of your company. Many companies that bootstrap early on also go on to gets business funding later on, but you will be in a much stronger position if you have already got a company that is working when you do.

New business finance is one of the hardest things in the world to get. However, there is no reason you cannot still start the business you have been dreaming about if you do not find the finance. Take a second look at your plan. Look for creative ways to finance your start-up yourself, and remember, where there is a will, there is always a way!

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