The Source Of Much Needed Equipment Leasing Options
Ask any entrepreneur and they will tell you, money can be hard to come by when times get tough. Although the financial crisis has ebbed somewhat, many financial institutions are still somewhat stingy when it comes to providing those all important small business loans or lease options. One of the newest trends on the scene in recent years is the concept of crowdfunding, and it is a train that more and more business owners are jumping on as a solution to their ills. The equipment leasing industry has taken note of this trend.
Crowdfunding is basically the professional equivalent of a program such as Kickstarter, where private citizens invest their money in a project they believe in, allowing the backers of those projects to reach their equipment n leasing goals. While the reward in this arena can be considerable, so too is the risk, with an equity stake on the line in return for capital.
Many so called Main Street businesses are likely to look for these types of loans, outfits such as retailers, restaurants, hair salons, gyms, and other similar enterprises. Funding may come from trusted circles of relationships, including friends, family, customers, and vendors, although some businesses that have established relationships with a borrower through a business association like a Chamber of Commerce or networking group may find additional viable options.
Funders are likely to believe in the trustworthiness of a venture when they see that other people are supporting the crowdfunding campaign. Once that trust has been established, it is more likely to attract funders that you may not know. The average loan request for projects such as this is in the neighborhood of $157,000, although there have been loans as small as $15,000 and as large as $1 million. Equipment leasing providers see much potential in this trend.
The idea goes back for some time, as the notion of getting loans from people who know you, carrying them through until crops are harvested or the herd is fattened is as old as currency itself. Crowdfunding merely takes this concept online.
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A Concept As Old As Time
The government has also taken notice of crowdfunding’s potential to drive economic recovery, with the JOBS Act being signed into law by President Obama in 2012. Average Americans are now able to fund businesses through the crowdfunding vehicle.
Until that law takes full effect, companies are searching for ways to provide funding within existing law, such as providing the platform for small businesses to connect with financial institutions, accredited investors, friends and family, business associates, and even government funding sources.
In an era of continued economic uncertainty, crowdfunding may be the innovative approach that is needed to jumpstart local economies and small business networks.
LeaseQ is one of the leading providers of business equipment leasing and financing in the United States.