You had an idea, started a business, and have worked hard. You now have a thriving and growing business.
Now is the time to seek funding to get over the growth hump and take your business to the next level. How are you going to get that funding though?
You face a tough challenge as 80% of small business loan applications get rejected. How can you better the odds in your favor?
The best way for you to ensure that your loan gets approved is to establish credibility with potential lenders or investors. The more confident they are in your business’ success, the more likely they are to approve your funding request.
Establish Credibility
When you go to secure funding for your business, your business’s reputation will play an important role. If you are looking to learn more about different online lending options visit this site.
You will need to show proof that your business is worth approving for a loan. You need to help develop strong confidence with the lender in your business.
1. Objective Approach
We understand that this is a tough one for people who are building their own business. You’ve worked hard, and this company is your baby that you have invested blood, sweat, and tears into.
The thing is, your lenders and investors don’t feel this way. They want to know that you can think rationally and make sound business decisions.
To show that you can do this, you need to show that you can be objective. Keep your focus on the goal and how you intend to get there while acknowledging any potential setbacks.
Think about it this way, if you were going to hand your money over to someone, you’d want to know all of the risks. Lenders have a right to know about the potential risks to agreeing to the transaction.
2. Open and Honest
The fastest way to ruin the credibility of your business is to not be honest. As soon as a potential lender or investor discovers that you are dishonest, they won’t want to work with you.
There are two ways that you can be deemed dishonest. The first is making up facts. The second is purposefully leaving out details to manipulate the narrative.
You should also keep in mind that if you are dishonest it can be deemed as fraud later on. This will create a world of hurt for you and your business.
3. Knowledgeable
No one is going to give you money if you sound like you don’t know what you’re talking about. You need to have the experience and skills to accomplish what you want.
Just remember that knowledge doesn’t always mean effective leadership. This is where being objective is important. You want to be able to admit that while you can direct the course of the business, you need to hire someone to manage the team on a day to day basis.
4. Promote Your Achievements
Now is the time to showcase how far you’ve come! People want to know that you have been successful so far. This will instill confidence that your business by showing the positive track record and likelihood of continued success.
Take some time to gather data about your company’s performance. Show how your product sales have grown. Show how you’ve increased your locations.
It can also help to show how your revenue or net income have increased. Finally, don’t forget to include any information about any previous debt that you have successfully paid off.
5. Endorsements from Others
Ask for an endorsement from those that you have worked with. This could be a past lender or a long-term client.
These parties can vouch for your business practices. Having other professionals speak on your behalf boosts your credibility more than you bragging about yourself.
6. Confidence in Your Business
No one else will have confidence in you and your business if you don’t have confidence in it. People want to be around and work with those who have a positive outlook and the confidence to achieve their goals.
This sort of energy is contagious, so your potential lenders and investors will notice if you don’t have it. Remember that you are likely seeking funding to further grow your business.
That means that you have plenty to be proud of. So remind yourself that you and your business are awesome and that you will get the funding you need.
7. Cleanup Bad a Reputation
You may find that through the course of business you have customers who review you online. These negative reviews are inevitable, you can’t please everyone.
However, too many of these bad reviews are a bad sign to potential investors. Before you seek funding, you’ll want to try to clean up your online reputation.
You can try to have the bad reviews removed. Or you can contact dissatisfied customers and rectify their problems.
You should also contact your satisfied customers and ask them to write a positive review of your business. This can help balance out any negative reviews.
Secure Funding for Your Business
The best thing you can do when seeking funding for your business is to be honest, objective, and confident. This will help to instill confidence in others about your proposition.
When you establish credibility, it becomes easier to obtain the funding you need. Credibility isn’t easily earned though.
Back up your claims with data and facts. This will show that you can objectively and honestly run your business.
Use these 5 tips to help repair your business’ reputation before you seek funding.