A bad credit score does not mean you can kiss your entrepreneurial dreams goodbye, as in the modern world of increasingly endless opportunities, even the worst credit scores of all are given a chance at redemption. While the road to long-term entrepreneurial success is long and often laden with numerous obstacles and challenges even for the well-endowed business leaders, rising from a financial pitfall is not impossible.
What’s more, nowadays there are numerous financing opportunities that don’t take your credit score into account provided that you have a great idea backed by a strong and viable business plan detailing the road to financial success. With that in mind, here are the five best ways to realize your entrepreneurial dreams even with a bad credit score.
Look for angel investors
It’s a long shot, but it’s definitely possible. Angel investors are out there, that’s for sure, but landing one is no walk in the park and it will take persistence, careful planning, as well as meticulous preparation and presentation. After all, you need to justify and shift the focus from your bad credit history to your awesome idea and how it can benefit both parties down the road.
Given the fact that no affluent investor will come near you (no, not even your rich aunt in Florida) unless you have a sound business plan in place detailing all of the financial aspects of starting, managing, and expanding a successful 21st-century business, there is an imperative to prepare thoroughly before you make your move. So, make sure you bring in a financial planner beforehand to guide you through the process, and set up realistic goals with strategies and complementary tactics that will see them to fruition. Only this way will you be able to grab the interest of an affluent investor.
Save up over time and launch your business
There is always the option of saving bit by bit over time until you’ve accumulated the capital to kick-start your company. Although it may take some time depending on your spending habits, living expenses, and saving routine, it’s a feasible plan that might save you the hassle of looking for investors or tidying up your credit score.
To make it work, you will need to organize your finances and segment your savings into distinct groups serving a unique purpose. For instance, you want to put money into website development, marketing, product development, relevant software, as well as towards obtaining a couple of key team members to help you guide the brand forward. All of these should be separate funds that you should invest in on a regular basis.
You can still apply for a loan, you know
Nowadays, you can absolutely obtain a great loan even if you have a poor credit score, as small business loans for bad credit are becoming increasingly popular with entrepreneurs across the globe. These loans can be obtained easily and efficiently, allowing you to secure finances that will help you start a business, equip your office space, or even pay your outstanding bills and debts to suppliers.
Arguably, business loans present the best solution for a 21st century entrepreneur looking to set their plans in motion and get their business off the ground quickly. Once you have established financial independence and a positive revenue stream, you can safely expand your business and pay off your loan without the risk of any more financial pitfalls.
Obtain finances through popular fundraising sites
Crowdfunding, or fundraising, might not be a new concept, but has sure risen in popularity over the past decade, leading numerous brands from the point of inception to worldwide recognition and success. So naturally, trying out your luck on popular crowdfunding platforms and presenting your idea to a global audience is a viable option – but it does have its drawbacks you need to take into consideration.
The main problem with crowdfunding websites is that everyone and their dog is trying to fund their great idea through these platforms, making it difficult to gain the traction and recognition you need to make your dreams a reality. Remember, no matter how amazing your idea might be, there is a distinct possibility that it will remain undiscovered due to the sheer number of competitors, so make sure you have a killer presentation to avoid this common problem.
Work on improving your credit score
When all else fails, you can always try to improve your credit score over time and increase your chances of snagging a good bank loan. While repairing a bad credit score is by no means a simple task, you can work your way slowly towards this goal by first requesting a credit report from your bank and checking it for any error and irregularities. This will give you a chance to dispute errors with the credit bureau.
Next, you want to set up payment reminders that will allow you to make all of your payments on time. Consider online banking for this purpose, and let your bank send you automated reminders, or you can even allow automatic payments through your credit card. Lastly, you can simply reduce the amount of debt you have over time by ceasing credit card use, and simply paying off your outstanding debts and interest fees.
In the modern world, everyone can become an entrepreneur, no matter the credit score or their overall financial position. With numerous ways to obtain adequate financing in front of you, there is nothing stopping you from realizing your entrepreneurial dreams and paving the road to long-term success in the business world.