Grow Your Business With These Financing Options For Women Entrepreneurs
Accessing finances to start and grow a business is one of the most formidable challenges women entrepreneurs have to contend with. Data shows that the lending landscape is unevenly skewed against women entrepreneurs. Recent research shows that women-owned businesses attracted below 5% of venture-capital funding.
As women in tech, we often bootstrapped our businesses and funded them through our savings. However, there are other financing options available to us. You’ll learn about business loans for women and different ways you can raise funds to grow your business. Moreover, you’ll also get to know how getting a loan can be beneficial to your business. Let’s get the ball rolling.
Most Common Funding Options For Women Entrepreneurs
Many women only know about business loans for women. However, there are more lending options available to women entrepreneurs. Read on as we explore more lending options for women to grow their businesses.
1. Angel Investors
You’ll be glad to know that many angel investors are willing to fund women entrepreneurs in businesses. Venture capital and angel investors are many women’s most common funding options. Angel investors are wealthy people who use their funds to finance businesses they’re interested in.
Smaller businesses would prefer angel investors to venture capitalists. Qualifying for funding from venture capitalists is more complex, given that venture capitalists generally have more stringent lending requirements.
Angel Investors who fund women businesses:
- Golden Seeds
- 500 Women
- Next Wave Impact
- Laconia Venture Asset Management (LVAM)
- Chloe Capital
- 37 Angels
- Intel Capital Diversity Initiative
- Female Founders Fund
- Springboard Enterprises
- Venture Capital
Whereas angel investors use their funds to finance businesses they’re interested in; venture capitalists invest funds on behalf of others. Consequently, venture capitalists have a greater expectation of returns from the money that they lend. The businesses they lend to need a compelling business idea that can generate a decent profit margin to justify the lending risk they take on behalf of investors.
Venture Capitalists that fund women entrepreneurs to grow their businesses::
- Hypatia Capital
- Kleiner Perkins
- New Enterprise Associates
- Trilogy Equity Partners
- Women’s Venture Capital Fund
- Aspect Ventures
- Cowboy Ventures
- Fearless Funds
3. Small business grants
Grants are essentially money that you’re not bound to pay back. Government institutions, private corporations, and other entities are primary sources of grants for small businesses. Since grants are typically free cash to inject into your business, they’re highly competitive, and the application process can be tedious and time-consuming. Nonetheless, it’s worth the effort if you’re successful.
Grant opportunities for women entrepreneurs:
- Eileen Fisher Women-Owned Business Grants
- The Girlboss Foundation
- Women’s Business Centers
- Small Business Development Centers
- Amber Grant
- Small Business Innovation Research
- SmallBusiness Technology Transfer programs
4. Small Business Loans for Women
If your business expansion plan requires substantial funding, it might outgrow what grants and angel investors may offer. That’s when a small business loan from somewhere like FatCat Loans becomes the appropriate funding option for your small business. Numerous private organizations and the SBA provide some options for women.
Here are a few lenders that you can approach to finance your business as a woman entrepreneur:
- The government-guaranteed SBA loan programs
- Elizabeth Street Capital
- Funding Circle-online term loan
- Credibility Capital- online term loan
- OnDeck- online term loan
- Camino Financial – loans for women
Alternative Financing Support For Women Business Owners
- Friends and family
- Personal loans
- Digital lenders who offer these loans: PeerIQ, OppFi, biz2credit, Affirm, Better.
- Equipment Financing
- Invoice financing
- Business credit cards
- Home equity loans
- Merchant cash advance (MCA)
- Nonprofit loans
How Can A Loan Help Your Business?
- To expand your business. You can expand by introducing a new product or opening a new physical store.
- To purchase more inventory
- To buy another business entity
- To boost a marketing campaign budget
- To hire more staff. You may also need a budget to outsource key projects like rebranding, SEO, or web design.
- For a product launch
- Meeting seasonal cash flow strains
- To meet the costs of huge orders
- To buy new equipment for the business.
- To restructure company debt.
Women entrepreneurs often suffer from a lack of financing options to grow their businesses. Fortunately, several organizations are willing to fund women in business. Go through the guide and find the option that suits the needs of your business and apply for business financing today.