It’s been a tough couple of years, and the economy is not yet out of the woods; but if you have a business, you need to know where to get the money to expand (or recover) when things start popping. If history is any measure, the years coming up will be a boom-time for sales. There’s already an excitement in the air. Your problem will be finding the cash to grow. Most banks are hesitant to extend large credit, and without the expansion money, you may not be able to cash in on the growth market. Your challenge is to ‘Find the money’!

Take heart. There are five distinct and different sources of money for growing businesses other than venture capital or initial public offerings (both of which are economically unavailable to most small businesses). Your task will be to convince these alternate sources of your ability to pay back the money with interest in some reasonable time. We’ll look at these sources, but first let’s look at what they are going to want from you.

The material most lenders wish to see is a complete and comprehensive business/marketing plan which includes the following seven items:

1. A historical financial description of your past business growth … and be sure to include the past lean years.
2. Your personal track record of managing and controlling your growing business
3. A report on what you are now doing to retain current customers.
4. A plan showing how you are going to find and attract new customers.
5. Forecasted sales based on the above, and the estimated cost of those sales.
6. An estimate of when the new capital will show an investment return (including an analysis of the total costs of running your firm during that time).
7. A plan for paying back the invested money.

Now, here are the five alternate sources of capital for growing companies. You will have to seek-out the sources, but the money is there, and the lenders desperately want to invest in a growing business. Don’t do these alone; get legal assistance as you begin actual negotiations.

CREDIT UNIONS & BANKS
- Just because your bank/credit union turns you down doesn't mean all will do the same. Just as you, these firms are in business to make money, and what may be a marginal investment for one may be just what another is looking for. Take your completed business/marketing plan to several outlets and talk with a commercial loan officer about your needs.

SMALL BUSINESS ADMINISTRATION
- The SBA has very little actual loan money, but it does offer several programs which guarantee payment of your bank loan. Since this source of money-guarantee to lenders changes at the whim of your government, you need to call the SBA, make an appointment, take along your business/marketing plan, and be prepared to spend endless hours in conversation. Remember, this is your government!

PRIVATE PLACEMENT MEMO (PPM)
– There are a number of financially well-off individuals out there who want to make still more money. A PPM offers private investors a debt note which can be converted to equity when the business shows a profit. PPMs are exempt from most securities laws, and this makes them a great way of raising special purpose or growth money. Advertise for this in the financial section of your newspaper, local business news, or similar publications.

ANGEL GROUPS
- There are people willing to take a chance on you and your business for a modest equity position. One great way of attracting these individuals is through the classified "Money Wanted" section of your local paper. Headline your ad, ‘Financial Angel Wanted’. Typically, Angels band together to come up with the money you need. Beware: Angels expect to take your business public in a very short time, cash out, and leave. In addition, most Angels want a position with your firm to watch over their investment.

FINANCE COMPANIES
- Finance companies are often a very good source of cash, some lending up to six figures. You can also use finance companies for short term debt financing. You can get reasonable flexibility of terms and conditions; but use caution! Interest rates are usually much higher than bank financing.

(NOTE TO EDITORS: PLEASE INCLUDE THE FOLLOWING.)
Paul Tulenko is an International Small Business Success Consultant based in New Mexico, USA. Additional tips and suggestions are available at www.tulenko.com or call (toll-free) 1-866-TULENKO.