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5 Small Business Funding Ideas That Work

While financing is a constant concern for small business owners, they now face a lending landscape that is far different—and more diverse—than the one that existed before the economic downturn.

For those businesses that do not qualify for traditional bank loans or for those that want to stay away from banks - especially those that have a strong, growing customer base and need working capital to support that growth – there will still be a robust financing market for alternative loans.  These alternative loans are actually changing by the day to better serve the needs of their small business customers.

401(k)/IRA Rollover Funding

Did you know that you can use your retirement funds to start or purchase a business – tax deferred and penalty free?

  • Rollover funds from a qualified retirement plan to start a business
  • No early distribution taxes or penalties
  • Minimizes going into debt for the start-up
  • No business financials are required / applies to new and existing businesses
  • Up to 100% of existing funds available for use

SBA Loans


Designed for start-up and existing businesses.

  • Loans can be used for any legitimate business purpose including working capital, machinery, equipment, furniture and fixtures, leasehold improvements, building acquisition or construction and in some circumstances debt consolidation.
  • Funding available from $20K to $5M
  • Longer terms/amortizations available


Finances fixed assets for small firms and plays a key role in creating and retaining jobs.

  • The business loan must be for real-estate or equipment.
  • The bank takes a first mortgage of 50% and the borrower is expected to come up with 10%.
  • The remaining 40% is raised by sale of debentures that provide the borrower with a 20 year fixed rate.
  • Most 504 projects are in the $200,000 to $13.7 million range.

Merchant Cash Advance

Provides small and medium-sized businesses with fast working capital. With a cash advance, your future credit card sales are purchased in order to advance you a sum of money. Unlike a loan, it does not require any collateral or personal guarantee.

  • Fast funding (applying is fast, free, and easy)
  • No personal collateral required
  • No restriction on use of funds
  • Funding amounts typically $5K to $250K


An affordable way to acquire equipment quickly without huge out-of-pocket expenses.

  • $10K+ with no collateral down
  • Potential tax advantages
  • Fixed payments and longer terms
  • Existing businesses, franchises; start-ups on a case by case basis

So, to the question: Can your company get a business loan in 2013? The answer is yes – but, the business loan might not come from the source that you thought it would. However, in the end, it is not really about the money but what you and your small business can actually achieve with it.

Len FischerFounder & Chairman of the Board, Benetrends
Len is the pioneer of 401(k)/IRA Rollover Funding. He developed this groundbreaking concept of rollover retirement savings tax deferred penalty free in 1983. He is a frequent author and speaker, lecturing extensively on small business funding, rollover business funding, ERISA and employee benefits. | @Benetrends | Facebook | More from Len

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