How To Finance Your Own Business

Self-Funding

Self-financing and entrepreneurs go in hand-in-hand – it is, in fact, the top form of financing used by start-ups*. Some also seek funding from family, crowdfund or do a combination of both. Alternatively, another option is to use a credit card for short-term financing – but this comes with high interest rates and can be expensive in the long-term. 

Using your own money for your business can come with perks such as no interest, no instalment payments or the worry of getting in debt. Bear in mind that investing your own assets is not without risks. Since you’ll have to dip into your hard-earned savings, be sure to:
 

Create a separate business account for better money management

• Consider your money as a financing or equity to your business 

• Keep detailed accounts of your expenditure 

• Not use your retirement or emergency funds

Get funding from a government scheme

SMEs are an important sector in Singapore. Enterprise SG has two schemes that cater specifically to SMEs- the SME Working Capital Loan and the SME Fixed Assets Loan that cover cash flow needs and investments.

Partner an investor

You can also look to angel investors or venture capitalists to help fund your business. 

Angel investors are individual investors and are usually directly involved in your business, so they can bring insights to help your business grow successfully. This is especially helpful if you’re just starting out, but it also means that you give up some control of your company.

Venture capitalists work for venture capital firms which invest money in businesses. Their usually large investments are helpful if you’re trying to grow your business quickly. However, venture capitalists typically want equity as part of their return on investment, so you might have to give up part of your ownership of your company.

Get a business financing

Want funds that you can use to run your business, your way? Business financing are useful if you need larger funds, and many banks offer them. Make sure you research their requirements, like credit scores, and whether you can meet them. CIMB offers different business financing depending on what you need. Find out about our financing for Property Financing, Refinancing, Working Capital and more here.

Every business has its own financing and management needs, and it’s up to you to decide what’s best for your business. Just make sure to do your research so you know exactly what you’re getting, and get your financing from reputable sources that you can trust.