Women own roughly 42% of businesses in the US while accounting for 31% of all small businesses. These women-owned businesses generate annual revenue worth $1.8 trillion despite the hardships they encounter when trying to access financing for their businesses.
Small business loans for women play a significant role in covering costs, ensuring a steady cash flow, funding for purchasing inventory, expanding the business, and meeting payroll.
As per Dominic Kalms financing facilitates the establishment and maintenance of female-owned enterprises, so it’s crucial for success. Here are some financing options for women. Also, click paystubs to find out how to generate check stubs online.
1. Great small business loans for women
Traditional business loans: women business owners shy away from conventional business loans from banks and lenders as approval can be tedious. These loans require the applicants to have collateral, an excellent credit history and credit rating, and a solid business plan before applying.
Small Business Administration (SBA) loans: the SBA liaises with banks to finance small businesses at competitive rates. It absorbs the risk of repayment, making it easy to access capital. You can only borrow up to $5 million, and the maximum repayment period of an SBA loan is 25 years. However, if you’re wondering if you’re making the right decision, then make sure to check A Neumann & Associates’ resources to be sure of the market trends.
Online lenders: can stand in place of traditional lenders as their qualification requirements are not as stringent. The application process is much faster, and they don’t require a storied credit history to qualify. However, they have steep interest rates.
2. Best grants for women entrepreneurs
a) The Amber Grant
Every month, the Amber Grant provides women in small businesses an opportunity to get $10,000 upon submitting a solid business plan, detailing how they intend to use the money allocated through the grant.
One of the 12 businesses awarded this grant within 12 months is eligible for a yearly $25,000 Amber Grant. This grant does not have particular initial qualification criteria.
b) Cartier Women’s Initiative Awards
This yearly grant is available to women all over the world. The Cartier Women’s Initiative Awards target businesses 1-3 years old, with great potential for growth and bias towards sustainable environment and social impact. Winner gets $100,000 and the runners-up $30,000.
c) Visa Everywhere Initiative
While this is for both men and women, there’s a specific Women’s Global Edition where two winners walk away with $100,000 after navigating through a fintech and social impact challenge. An excellent resource for fintech businesses.
It isn’t precisely a grant, but it provides a comprehensive listing of all the available opportunities for women to access grants across all industries.
3. Other funding options you can consider
i) Pitching to investors
Female entrepreneurs with viable projections for an established business and a shortage of funds can approach investors for venture capital. The entrepreneur comes to a favorable agreement on the profit percentage to pay back to the investor. However, venture capitalists will require equity and involvement in the decision-making process.
It refers to the practice of sourcing financing from a large group of participants through a crowdsourcing platform like Kickstarter. You will pitch your business ideas, and if the group likes it, they will make small individual payments that can even balloon and surpass the requested amount.
You can finance the business using your savings. It’s a great avenue for avoiding interest payments or giving bits of your business in equity deals.
iv) Family and friends
They can chip in through gifts or loans that you can repay later—one of the best ways of escaping extortionist interest rate payment and repayment terms.
Ways To Support Women-Owned Businesses
The number of women entrepreneurs seems to grow yearly thanks to available financing options and their strong will and determination. Women entrepreneurs have increased by over 114% in the US in the past 20 years, but there is still a long way to go. Therefore, it is vital that you support women-owned businesses whenever you can. Here are a few ways you can help women-owned businesses grow.
Shop at Women-Owned Businesses
Spending your money at a women-owned business is a great way to show your support and make an impact. When shopping for clothes, home goods, or other items, you should search for women-owned businesses that sell these items. By shopping at a women-owned business, you support not only the owner but the community as a whole. Additionally, purchasing and using these items in your daily life is also a form of advertising that may help bring the business more customers.
Collaborate With Women-Owned Businesses
If you are also a business owner or have some influence online, you can collaborate with women-owned businesses. You can promote their business on your social media and ask them to do the same. If you own a business, you can feature products from other women-owned businesses in your store to help them increase their sales. Holding events and panel discussions to raise awareness is also an excellent way to help women-owned businesses.
Try To Set Goals for Intentional Shopping
When shopping, you may be influenced by the brand value and social responsibility and feel as if you must shop at big-name brands. However, if you are intentional, you can easily direct yourself to women-owned businesses that may be offering the same product but with better quality. By setting a goal to shop intentionally, you will challenge yourself to find more women-owned businesses, which can make a massive difference to the business and the community.
Amplify Your Favorite Women-Owned Businesses
If there is a women-owned business you love, don’t be afraid to share it and leave reviews. Testimonials and reviews work wonders for small businesses. You can even share the business and its items on your social media and tag them.
Through grants and business loans for women, ladies can access various financing options like grants, SBA loans, and bootstrapping to help their small businesses take off and thrive. Resources for women owners are readily available.