Australian Business Podcast episode #6 is now live on the Rask network: how to get money to finance your small business — using cash savings, loans or equity.
This episode aligns with Lesson 6 of the Rask free business course.
Note: if you’re looking for a business partner, adviser, coach or investor in your business idea, I want to hear from you. I’m actively looking for small businesses that I (or my network) can support. Get in touch with me.
I highly recommend avoiding debt, especially when your company is new. If your debt is secured against you or your home (for example), the bank can come for you or your home if your business fails.
In this episode, I — Owen Rask, founder of The Rask Group — dive into the all-important topic of financing your business:
- Using savings to grow your business (and working out how much you’ll need)
- What you’ll need to do in order to get a business loan:
- Details on your personal financial situation
- The business’ accounts (if any)
- Anything that can help you prove to the bank that your business will work (market research, competitor examples, your experience, etc.). See our lesson on business plans — you’ll need a proper business plan.
- Selling equity
- You’ll probably need a company structure, which also requires a shareholders agreement (Legal Vision has a free template)
- Using “sweat equity” to motivate employees
- Getting money from friends, family and the faithful
Please don’t sell any equity in your business until you have fully considered the pros and cons. Also, you’ll likely need a company structure (it makes life easier), so you issue shares. Legal Vision has a free template for a shareholder agreement . More on this soon…
Please note: if you’re confused about business ‘structures’, like companies, trusts, “sole traders”, etc. that’ll be covered in episode 7 of The Australian Business Podcast — but it’s available right now in our free business course.
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