As an entrepreneur, there are numerous finance terms that you need to know and understand in order to make the best funding decisions for your business. For example, if you are considering borrowing money from mezzanine finance companies, you may also need to know what other options are available.
Many small business owners do not even know the meaning of the term mezzanine finance, let alone whether it is a viable option for their business. Before taking this funding step, it is important to know more about it as well as additional choices.
What Are the Advantages and Disadvantages of Mezzanine Finance?
When businesses are looking to expand, they may seek information about mezzanine finance. Some believe that this is a good way to get quick business financing without having to provide much collateral.
Also, mezzanine finance shows up as equity on a balance sheet, which can help when it’s time to seek a fast business loan in the future from traditional lenders. It might also be easier for some businesses to obtain this type of funding because all you need is a proven track record of success with your product and a strong plan for what you plan to do with the money.
Although this may sound ideal, there are some serious disadvantages. For one thing, the lender will expect up to 30 percent return on the investment.
Perhaps the biggest drawback is that the lender can take equity from the business or even ownership if you have any difficulty repaying the money. That’s quite a huge price to pay for a quick business loan.
Are There Other Options Available Instead of Mezzanine Finance
Prior to potentially giving someone else control of the business you have worked so hard to build, check out a business cash advance company, like Financing Solutions (www.fundmypayroll.com). They can provide a less drastic option for growing your business.
Financing Solutions offers short term, unsecured financing up to $150,000 and is based on your company’s history and its ability to repay back the cash advance. They do not take any ownership equity or interests.
One thing they do give you is peace of mind. You can obtain fast business financing with a flexible schedule that allows you to repay the money in a few months.
This lets you get back to the main focus of growing your business sooner. Also, once you have developed a successful relationship with Financing Solutions, you can return to them for additional funding.
Options for Growth That You Can Start Quickly
When you are ready to grow your business, you typically want to strike while the iron is hot. In other words, you want to do it now while you have the drive and resources.
One option is to increase your market share. This involves a thorough understanding of your industry. You need to know what you are doing right or wrong and how to steal customers away from your competition.
You can also look into joint ventures or partnerships. Finding a non-competing business to link with can have significant advantages. It can be an ideal way to open your business to new markets and strengthen your position within your industry.
The best option for growth is Financing Solutions. They can provide the quick business funding you need to take your company to the next level.