Funding—the Basics

Questions about business funding can cause hand wringing and sleepless nights. Fortunately, if you learn some basics about funding types and fully prepare before applying, you can significantly increase your chances of getting what you need.

Financing is in the details

Planning to apply for a loan, line of credit, credit card or almost any type of capital investment, you’ll need to have a good understanding of your business’s financials: profit and loss statements, credit report, and business plan to begin with. It’s easier to advocate for your business when your pitch is backed by hard numbers. 

If it’s still early days, there are options for small businesses that aren’t yet earning revenue or need loans under $250,000. Research nonprofits and alternative funding sources to find the right option for your needs. 

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Types of funding

You can broadly think of funding as falling into two main categories:

Conventional funding sources

Conventional funding sources

Bank and credit union loans and lines of credit are considered conventional options that typically require the longest and strongest track record. Bank loans often have minimum requirements for profitability, credit rating, and length of time in business (usually at least 3 years). In addition they often require collateral, such as property, equipment or expected payments for an upcoming order. That said, banks and credit unions sometimes offer special programs for businesses without the credit history needed for a typical business bank loan.

Interested in learning about business loans and lines offered by Bank of the West?

View Bank Loans

Creative funding sources

Creative funding sources

This is a vast and varied world that serves business owners at all stages, but especially those just starting out. Community Development Financial Institutions (CDFIs) and microfinance institutions are designed for businesses that are new and may not have everything a business owner needs for a bank loan, such as a minimum credit score. Creative options also include money from family or friends, venture capital and grants.

Learn more about financial resources for new women entrepreneurs:

Fuel Your Business: Financial Resources for New Entrepreneurs 

Small Business Express Lending - Options for Funding under $100,000

At Bank of the West we want to connect you with financial products to help support your unique business plans. Simply select how you will use the funds, begin our streamlined digital application process and we'll provide you options for business credit cards, lines of credit or term loans up to $100,000 upon approval, with access to funds in as little as 2 business days.

Small Business Express Lending

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Start building business credit

Bank of the West offers business credit cards to give new businesses the power to purchase while developing their credit history. Talk with a business banker to find out if a card might be helpful to you.

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Funding for startups and new businesses

Working Solutions is a Community Development Financial Institution that specializes in startup and early-stage financing for Bay Area entrepreneurs. They’re committed to helping local entrepreneurs get the support they need to thrive by providing capital, consulting and community connections.

Connect with Working Solutions

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Disclaimer

Loans and lines of credit are subject to credit approval. Terms, conditions, fees and other restrictions may apply.