Emergency Management


Business financing


According to a recent study on entrepreneurship, 55% of Americans want to move from an internship to a significant company shortly. Speaking from this point of view, we will start to see an avalanche of start-ups, most of them focused online.

At the same time, if we look at the latest data on the number of companies closed from year to year, we see an increase of 10% from this point of view. Out of 100 startups, 96% go bankrupt in the first two years, 2% in the first five years, and 1% in 10 years.

One of the reasons why more and more companies are closing down is the lack of coherent and stable company financing from the beginning.

Here are the five most important sources of financing that a business can have for longer life. Note that these sources are also available in Trempealeau County, Wisconsin.

Bank investments or direct lender loans

Here is all the capital you can get from a bank or alternative lending company. Several financing methods can represent this bank capital:

  • Bank credits;
  • Lines of credit;
  • Other instruments for financing trade operations: Factoring or discounting, letter of guarantee, promissory note, documentary letter of credit, collection, lump sum.

Bank capital can be obtained by anyone who has a guarantor and has a well-defined business plan that justifies the required financing.

In financing terms, bank credit can be used either in the short term or in the long term, and the credit line can only be used to finance daily activities.

The reason you should apply for a line of credit should be:

  • working capital financing;
  • the estimated cash for a period is negative;
  • receipts are not sufficient to cover the payment requirement;
  • when there are correlations between payments and receipts from late customers.


Microfinance is a source of funding that has gained momentum in recent years and is increasingly used by start-up companies. As it is understood from the name, it is addressed to companies at the beginning of the road and involves granting loans on more straightforward terms and at higher costs and interest than bank credit.

This is a short-term source of financing and covers the costs of setting up a business. The amount you can attract is much smaller than in a bank loan due to the more flexible and more accessible to meet conditions. This source of financing is also used as a guarantee for possible loans or bank loans.

Grants for business

It is at the top of the most popular sources of financing during this period. We all want and think about how to use the non-reimbursable funds to develop our business further.

Various investors

We can break this class of funding sources into two categories:

  • Family, friends, acquaintances
  • Business Angels
Family, friends, acquaintances

One of those traditional sources of funding that we think about from the beginning. A relatively easy source of financing if the relationship between you and the investor is where to trust.

Most of the time, the money is small, but it is good to support the business for 1-3 months. Here it depends a lot on the business idea and the power of the investor.

It is one of the most flexible sources of financing, which gives you confidence, support, and understanding in case the money cannot be returned on time.

Business Angels

A Business Angel represents the investor with a lot of cash who is willing to get involved in as many businesses as possible as an associate.

In addition to financial resources, they also come with a very high dose of experience to grow the business as quickly as possible and make a profit. The financing period is medium or long, and most of the time, the investment does not exceed 1 million dollars. It is a rather tricky source of funding to obtain, given that you have to convince some very experienced people that your idea is excellent.

Issuance of shares and bonds

It is a source of financing that huge companies can only use. It is one of the most accessible sources for a large company that wants to expand and raise funds for business development. All that is needed is approval from the General Meeting of Shareholders and finding investors.

These are the top 5 sources of financing that a business can have. This may result in other more non-commercial sources of funding that I will discuss in a future article.

We further invite you to tell us your opinion about these sources or propose other financing sources for a business that does not appear on this list!