Business Finance Solutions

Erik S Heyl asked:

At some point throughout the life of your business you will likely come into a set of circumstances that requires you to obtain additional funding for your business. You have no doubt considered two forms of funding to be your best candidates these forms are a business loan or the forming of a partnership with a partner that does not have a business but does have money. In considering these two choices it is important to weigh all of your factors carefully as some of the factors are more important than others. The first thing you must ask yourself is am I okay taking on a partner? Not only is this a question of business priorities but also a question of personal priorities some business owners simply do not work well in a partnership relationship where others will do extremely well having other people involved to bounce their ideas off of.

Also when weighing your options between a business loan or partnership. You must consider not only the current profitability of your business which for new businesses is typically quite low but also weigh this against the future profitability. No doubt the person that you are considering partnering with is making a similar assessment about your business. If your business is not currently profitable and will not be profitable for a couple of years then a loan may not be enough of a stopgap solution for this problem. What if your loan repayment makes your profitability that much harder to obtain? In this case it may be wise to take on a partner instead of borrowing money for your business.

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