You’re in the early stages of building your dream to create a bold new vision for the future.

You’ve cultivated an amazing team – they’re dedicated, committed, and motivated.

Your business model is solid – it’s producing recurring revenues.  You have tangible assets.

But now you need cash to fuel your business growth.  As a founder you can reach out to Venture Capital markets – and they may be the right fit – but how much equity are you willing to give up?

Something Founders should consider exploring and learning more about is Non-Dilutive Debt Financing.

Non-Dilutive Debt Financing protects your shareholders’ equity and control, and can provide a creative solution to fuel your growth. 

8 Non-Dilutive Debt Financing solutions that entrepreneurs should consider when evaluating their business plan:

  1. Working Capital – You need to fund new sales and marketing initiatives, or perhaps you need to expand your operations – a working capital loan with flexible terms can help scale your business.
  2. Equipment & Software Leasing – Do you need new hardware, machinery, or software?  Leasing can provide better cash management.  Equipment & Software Leasing can provide terms from 12 to 84 months, ranging from $2.5k to $10M plus.
  3. “As-a-Service” Financing – Are you providing software, hardware, or services as a monthly cost?  As-a-Service Financing can help bring revenue forward, and can be customized to meet the goals of your business.
  4. Factoring / Invoicing Discounting – Do you have committed contracts or invoices, but you won’t receive payment for 30, 60 or 90 days?  Factoring / Invoicing Discounting can provide advances up to 95% of the contract value to improve cash flow.
  5. Purchase Order (PO) Financing – You have a PO, but you require an immediate cash injection for inventory or production costs.  PO Financing can structure non-dilutive debt financing solutions to inject cash into your business, based on the mechanics of the PO with your client(s).
  6. Term Loans– You’re an established business, you own equipment or real estate assets, and you have a solid balance sheet.  Term loans can provide your organization with fixed-asset financing with terms to match your business objectives.
  7. Credit Cards: Business credit cards are a great way to pay suppliers/vendors and leverage your existing line of credit available through your credit card. Using a business credit card will also help build your corporate credit history.
  8. Research & Development Financing – You’ve received an R&D grant, but now you have to wait weeks or months for the funding to arrive.  R&D Financing provides your company with advances up to 95% of the grant to quickly inject cash into the business.

*   *   *

This post was written by Michael Stefanison (Chief Entrepreneur Officer of BuildingTheNextUnicorn, a Founder Institute partner organization. Building the Next Unicorn focuses on the startup community by providing proven and innovative non-dilutive debt financing solutions as instruments to help shareholders retain their equity while fuelling business growth.