Previously we talked about how to take the first step as an entrepreneur and how crowdfunding can be an effective alternative for financing the startup of a project. Today we will talk about when the project is already underway.
For an entrepreneur, identifying the right moment to grow is one of the biggest challenges they face. And to achieve this, financing is key. This challenge can also present itself as a lack of options that provide stability to the company’s liquidity or other forms. Ideally, this stage would be financed with accumulated profits after long periods of work, but they are not always sufficient or do not arrive on time.
Although public programs and subsidies exist, as well as the traditional banking financial network, both paths are usually full of requirements, long deadlines, guarantees and collateral. For this reason, having the support of a specialized consultancy or manager makes the difference. But waiting and complexity can prevent a growth opportunity.
This is where the so-called alternative financing sources take on the role, available to any SME. These are a great option for starting new projects, but also when the business is already running and a quick and flexible way is sought to strengthen liquidity or expand the project.
Fintech and crowdlending platforms offer products similar to those of traditional banking, but with much more agile processes. These companies connect private investors from around the world with SMEs that need financing. They offer solutions such as loans, factoring or confirming, with competitive conditions and much simpler procedures.
While a bank can take weeks to resolve an application, many fintechs respond in a few days, even hours. Platforms like ECrowd, Colectual or October allow requesting amounts ranging from 3,000 to 300,000 euros, with terms and interest rates that compete directly with those of banking, and with much more digital and transparent management. Even if your need is specific, such as paying suppliers with greater flexibility, these platforms offer solutions to cover payments of up to 3,000 euros, with repayment terms of up to 180 days.
Just as an entrepreneur is able to see where there is a need that they can cover with their product or service, they can also see that there are new ways to finance their growth outside of traditional banking. The key is to get informed, compare options and not close the door to new tools that have arrived to help SMEs continue moving forward.
If you need help in this area, you can request the free advice that we offer from the Economic Office of Galicia. All you have to do is fill out an online form and an expert will get in touch with you.
