Steven D. Strauss - Get Your Business Funded: Creative Methods for Getting the Money You Need

Copyright 2011 by Steven D. Strauss. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

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Library of Congress Cataloging-in-Publication Data:

Strauss, Steven D., 1958

Get your business funded: creative methods for getting the money you need/Steven D. Strauss.

p. cm.

ISBN 978-0-470-92811-0 (pbk.); ISBN 978-1-118-08655-1 (ebk); ISBN 978-1-118-08663-6 (ebk); ISBN 978-1-118-08665-0 (ebk)

1. Small businessFinance. 2. Business enterprisesFinance. 3. New business enterprisesFinance. 4. Venture capital. I. Title.

HG4027.7.S857 2011

658.150224dc22

2011002029

This book is dedicated to all of my great readers over the years. You have allowed me to follow my dream. Thank you so much.

Acknowledgments

I would like to thank Maria, Jillian, Sydney, Mara, Larry, and Spencer for their love and support. I would also like to thank my friends at John Wiley & Sons.

About the Author

Steven D. Strauss, often called America's leading small business expert, is an internationally recognized author, columnist, lawyer, and speaker. He is the senior business columnist for USATODAY.com and his column, Ask an Expert, is one of the most highly syndicated business columns in the world. Steve is also the small business columnist for American Express OPEN Forum, and AT&T. He is the author of 15 books, including The Small Business Bible .

A highly sought-after commentator and media guest, Steve has been on ABC, CNN, CNBC, The O'Reilly Factor , and scores of other shows. He is a regular guest on both MSNBC's business show Your Business and ABC News Now . Steve is regularly seen in magazines and newspapers such as Time , Inc. , Entrepreneur , Success , New York , the Los Angeles Times , the Chicago Tribune , the New York Daily News , and many more.

Steve often speaks to groups the world over, including a recent visit to the United Nations. He sits on the Board of the World Entrepreneurship Forum, and is also a speaker for the US State Department, speaking in places such as the West Bank, South Korea, Bahrain, Japan, Mongolia, and Jordan. He is often asked to be the small business spokesperson for companies that wish to reach the small business marketplace.

Steve is also an entrepreneur. He is president of The Strauss Group Inc., which includes the Strauss Law Firm, Strauss Seminar Co., Strauss Syndication, and MrAllBiz.com. He graduated from UCLA, the Claremont Graduate School, and the McGeorge School of Law, and was a Coro Foundation Fellow in Public Affairs. If you would like Steve to help you get your business funded, have him speak to your group, or to sign up for his free newsletter Small Business Success Secrets! , please visit his website, www.MrAllBiz.com .

Introduction

Getting the money to fund a business used to be easier.

Back in the day, options abounded. Banks had ready capital to lend, and if you did not qualify, Small Business Administration (SBA)-backed loans were available. If they didn't suit your needs, then you might have considered a home equity loan; with housing prices rising at near a 10 percent annual clip, entrepreneurs often tapped the home equity ATM. Low-doc or no-doc home equity loans were common, as were loans of 125 percent of the value of your residence. If you needed bigger bucks, venture capitalists and angel investors were more than happy to get you some cash in exchange for a piece of the pie.

Those days, as we all know too well, are long gone. The housing bubble burst. The mortgage crisis hit. The stock market tumbled. Capital markets dried up.

As a result, today, while many of those funding options are still around, terms and conditions, as they say, apply. There is less money and it is harder to get. But harder is not the same as impossible. If having less money available is the bad news, the good news is that not only is it still available, but a crop of new, creative options have also emerged. You just have to know where to look.

This book is the right place to start.

As the senior business columnist for USATODAY.com, author of The Small Business Bible, and a popular speaker on the business lecture circuit, I get to meet a lot of entrepreneurs. What I know is that money is still out there; it's just hidden a little better these days. Finding the money you need to start, run, or grow your business today takes more creativity and, probably, a few more sources than you may anticipate. But it is still out there.

That's where I come in. In this book, you will find, and learn how to tap into, scores of ways to fund your businesseverything from traditional bank and SBA loans to new and more novel ideas like crowdfunding and microfinance. The money is still out there, and I'll tell you where to find it.

If I do my job right, yours just got easier.

Steve Strauss
www.MrAllBiz.com

Overview: Understanding the Funding Process

Show me the money! Cuba Gooding famously screamed to Tom Cruise in Jerry Maguire , but it just as easily could be said by many a small business person these days. There is no doubt that finding the money to start, run, or grow a business is more challenging today than in the recent past. But that said, it is still very doable.

Want proof? As you drive down the street, notice all of the small businesses that line the road. Or do a Google search for all of the small businesses in your city. There are a lot of small businessesin your city, in your state, and in the country. How many? Try 30 million or so.