Finance your new business with a business loan
What issues can you run into when financing your new business? It can be a challenging journey, but a good preparation can maximise your chances of success.
How do you start a successful company?
First write a business plan. In a business plan you organise and structure your ideas as clearly as possible. This provides insight into opportunities for your business. And who your competitors and potential customers are.
The next step is to test whether your plans are financially feasible. This part of your business plan is called the financial plan. The financial plan will tell you how much money you may need to borrow to start your business.
A good business plan contains lots of information and inspires you to get started. It answers questions like:
- Who are you as an entrepreneur?
- What are your strengths?
- Who is your target audience?
- Who are your competitors?
- How much money do you need?
Here is a checklist of the most important steps to take when starting your own business.
How to prepare your application for financing
Always look closely at your financial plan when preparing a finance application. This will give you a quick, targeted summary of your financing options. It will also give you the answer to questions like:
- what financial know-how do I need?
- How can I get money for my business?
Forms of finance
Bank loans are the most common form of finance. In recent years, there has been a shift toward a mix of financing options, known as stack financing. The most common forms of finance are;
- flash credit
- online financing using FinTech
Starting a business with unemployment benefit
If you are receiving an unemployment benefit, you can make use of the Bbz scheme. This scheme offers financial support for self-employed professionals. Bbz benefits consist of an interest-free supplemental benefit to cover living expenses for up to 3 years. You can also use the Bbz benefit as a loan, allowing you to invest in machinery, inventory, or stock. In this case, you do have to pay interest.
Proof- of-concept funding
Does your business aim to tackle social issues and increase prosperity and well-being with innovative products and ideas? Then you can apply for for Proof-of-concept funding (VFF).
What do financiers look for?
When you apply for credit, financiers will look at both hard and soft criteria:
- hard criteria relate to your business and your plans
- soft criteria relate to you and your entrepreneurial skills
Make sure to put together a good presentation that shows you have thought about what the financier finds important. KVK explains what lenders look for if you are applying for a business loan.
Check the Financing Guide
Financing a business can be complicated. KVK's Financing Guide can help. The Guide includes information about different financing possibilities. Use the Financing Finder to help you decide what type financing is right for your situation.
Tips
- Bring in an independent adviser.
- Invest your own money if possible.
- Reserve funds for interest and loan repayments.
- Create a mix of finance forms.
- Prepare a good elevator pitch.
Video: Financing your business
What steps do you need to take to raise money for your business? Which parties provide finance? KVK goes into everything you need to know in this video.