Besides the more well-known forms of loans, credits, and credit lines, there are other ways to obtain financing for your business. On one hand, there are internal financing methods, meaning those that rely on the company’s own generated resources. Among these, depreciation funds stand out—this involves accumulating capital to offset the loss in value of an asset over time (for example, if we purchase a machine with a ten-year lifespan that costs €20,000 and expect to sell it for €2,000 at the end of its use, we would set aside €1,800 per year in a fund to compensate for the depreciation); and reserve funds, which are profits retained instead of distributed. The law requires a minimum reserve, but this can be expanded by company bylaws or by partners’ agreement.
Other forms of external financing, different from loans and credit, include leasing or financial leasing, which allows you to acquire capital goods without large upfront payments or committing to a loan; discounting, where a financial entity advances payment for pending promissory notes while charging a commission; and factoring, which involves transferring unpaid invoices to a third party.
In recent years, new financing models have become popular, such as crowdfunding, which combines marketing and financing without creating debt; and business angels, a kind of entrepreneurial mentor who, in addition to financing, gets involved in the project by contributing their experience, know-how, time, etc.
Through the Oficina Económica, we offer free advisory services. You just need to request them using our online form.
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