The Business Credit Lifecycle
Written by Mustafa Curry on Oct. 14th 2017
Seed Stage
In this early stage of your biggest obstacle is "turning your idea into a product or service" into a feasible business. This is the time for planning around credit, savings, or a combination of both. This includes:
-Legal structure of your business (legal consultation)
-Business Planning
-Researching Your Market
-Funding Strategy
Startup Stage
In this stage for most business owners the biggest concern is Cash-flow!! Receiving adequate funding. Using personal credit and savings is by far the most common ways to fund your business however it's not nearly enough to sustain your business nor is it enough to properly grow your business. Having skin in the game is a must in the eyes of lenders. Common sources of startup funding are:
-Friends And Family
-Personal Assets
-Business Credit Cards
-Venture Capitalist and Other Investors
-Small Business Lenders/Loans
-Vendor Credit
Growth Stage
As your young company grows, so does your financing needs. While you don't want to spread yourself or your business too thin you do need to have access to business capital/credit to take advantage of opportunities as they arise. Make sure your business is well equip to take action as your company moves forward. Possible funding sources at this stage are:
-Business Lines of Credit
-Equipment And Vehicle Financing
-Small Business Loan
Maturity Stage
Your focus at this stage may consist of keeping your edge on the competition. As an established business you should consider reviewing your existing business loans and any other financial obligations tied to the business
-Refinancing At The Best Terms
-Business Real Estate Line Of Credit
Expansion Stage
Taking your business to the next level. This process will look almost the same as in the initial startup stage. Funding will be key!! This time around your company is established with a solid credit profile and more options that previously. Very few businesses have excess cash and capital to pay for expanding. Receiving funding for your expansion will typically come from one of a few ways:
-Business Real Estate Financing
-Investors
-Business Term Loans
-SBA (Small Business Administration)
Transition & Exit
As you begin thinking of parting ways from your business, whether its to sell or hand off to a future successor there are a few steps to take in doing so and they are:
-Coordinate an exit strategy
-Gather an advisory team
-Debt Consolidation
-Refinancing equity
-Business Savings
Financially you want to make sure any business debt is refined in the most optimal position for the business's future
Mustafa Curry
Mustafa Curry helps business owners obtain capital through a 3-step process of building business credit. He is an expert at the process of structuring a business to get approved for funding.
If you're interested in obtaining capital for your business then definitely reach out and request a free strategy session today.
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