How To Get A Startup Business Loan

How To Get A Startup Business Loan , the initial capital has always been a frightening specter for startup startups to dare to start a business. If it is not the descendants of wealthy people who can easily borrow capital from parents, young entrepreneurs can certainly be made dizzy looking for an injection of funds for the sustainability of their businesses.
In the midst of the current era of intense global competition, young entrepreneurs who are generally very brilliant in sparking new ideas in doing business certainly do not only compete with entrepreneurs from their own country.They must compete in establishing startups that are not only innovative, but also prospective in the eyes of international capital owners. Only in that way, investors would want to inject funds so that the startups they established developed into large ones.
Never mind that one day his startup could be worth more than 1 billion US dollars (US) and worthy of the title of unicorn. To be able to ensure that their employees’ paychecks until the next quarter are confused. But as the old saying goes ‘Many Roads to Rome’, then the problem of capital should not stop your intention to create something big. Because after all big achievements, always pioneered with small things right?
Efforts to find capital with your own efforts, of course, aims to reduce the amount of debt that you take to meet capital needs at the beginning. The smaller the value of debt, of course the smaller the amount of liabilities you must return to the bank.
If you want to start a startup, funding is an important aspect. Acquisition of funds for startup comes from a variety of sources, one of which is through loans from banks.
But applying for startup funding to a bank requires several conditions, and in it is a business plan. The information included in the business plan must be detailed and answer all questions that the bank needs to know. For novice startups, this information is also needed because they do not yet have a financial track record to be examined by banks. Having a business plan is not only part of the bureaucratic checklist for getting a loan.
Instead, a business plan can be a guidance document for companies that communicate facts and ideas that are very important to the management team and employees. There are some core elements that must be possessed by a strong business plan. They apply equally to loan applications supported by the Small Business Administration (SBA) and for regular commercial loans:
1. Detailed Projection
To get approval from the bank, they need enough detail to ensure that your business will have enough profit and cash flow to service debt. The plan must refine exactly how a company will achieve its revenue goals and estimated expenses.
Then how does the company hope to succeed in the long run, not just the next few years.
2. Marketing Strategy
The plan should also describe the company’s marketing strategy as detailed as possible. Before giving capital, the bank wants to know how its business proposes to market its products or services and the specific opportunities it wants to fill.
The plan must answer the question: What is the need for the company’s products or services in the area, and how will the company issue its message?
3. Management and Ownership Experience
To approve a loan, the bank wants to know that the owner has the right background and experience to get the business going. That helps convince the bank that the projections have been thought out and can be successfully implemented.
Different types of businesses require different skills. An owner with a long resume as a manager in a large company may not have the ideal experience to start a restaurant.
If the business is in a high volume, low margin industry, the bank will feel more comfortable with an owner who has proven experience in managing costs.
4. Location
Depending on the type of business, small details about their physical location can be very important. If you open a cafe or coffee shop, you want to be on the side of the road that people use for their morning trips. If the business is a roadside restaurant that relies on passing drivers, it must be easily accessible by car.
The plan must identify the location and why you believe this location supports your business model.