For some reason, entrepreneurs have gotten into a headspace where bad credit automatically equals an inability to run a business properly. In spite of what you might have heard, it is possible to run your business in spite of having bad credit.
Yes, the world is starting to feel a twinge of Kickstarter fatigue. That doesn’t mean, however, that you shouldn’t still try to crowd source at least some of your initial funding. Crowd funding is a great option for two reasons. It will this bring in the capital you need to get started and, potentially, carry you for a while as you repair your credit. It also provides you with proof that your business is supported by the local community—which will be helpful when you feel ready to apply for the business loan you need to expand. If you’re sick of hearing about Kickstarter, you might try setting up with Indiegogo, which has its own vibrant community.
Taking on Investors
If you have a really great idea, you might try asking people to invest in your company or product. Taking on investors can feel intimidating, especially if you haven’t ever done it before. It can, however, be quite lucrative and it sets the stage for later if you want to apply for incorporation. You can invite your investors to become members of your board and repay their investment with shares of the company stock.
Bad Credit Based Credit and Funding
There are some companies that work solely with entrepreneurs and businesses that have bad credit. Secured credit cards are one example of how a bank will help a person or company rebuild credit after taking on bad credit surety bonds. Credit unions are another option as they are usually more lenient than traditional banks when it comes to helping businesses. And, when you work with a credit union, you’ll be helping a fellow local business which is good for your economic karma.
Keeping Costs Low
Have you thought about outsourcing some of your smaller things? Working with freelancers is another way to reduce costs as they are generally cheaper than simply hiring an employee for the same job. Joining rewards programs at stores to help cut down on the cost of supplies can also be helpful.
Don’t let anybody tell you that you can’t still run a business when you have bad credit. You can! You just need to think a little bit creatively.