Here’s an article about Small Firms Using Credit Cards for Capital.
If you’re young and looking to start a small business, one of the first challenges you will encounter is how to fund your startup. The most obvious route (for me, anyway) was to acquire some type of small business loan from the local bank. But, with no major assets and no proof of a profitable business in action, acquiring a loan is near impossible. I’m sure many other young entrepreneurs will experience the same thing.
But, there is hope.
One very risky, but viable option is to jump start your project with a credit card. This article talks about that. From my own personal experience, using a credit helped my small startup succeed.
As the article states, remember that there is good debt and bad debt. “Good debt generates revenue; bad debt consumes it.” For my Greek Store, we used credit to purchase assets (machines) with good resale value. The machines also allowed us to vertically integrate our business and provide for better margins. To us, this was good debt that would pay for itself.
Spend Now, Save Later is an article I found on Wednesday. This article kinda hits home for me.
The article talks about recent graduates who want to invest in their success, rather than build their retirement nest egg. In contrast to those $30,000 Millionaires, this group is serious about establishing wealth for themselves. What sets them apart from the rest of us is their tolerance for risk. They’re willing to give it all up!
But who can blame them? I hear everywhere that those in their 20s are young. By being young, you can take greater risk in your finances. In other words, risk it now, hope for the best, and work in an office if things go sour later down the line.
Personally, I am somewhere in the between the extremes (save all your money vs. use all your money). I am not afraid to invest my time and money into a side business project. I find the adventure of entrepreneurship to be exhilarating. However, I am not prepared to lose it all by age 30, and have to worry about where I will get money for next month’s rent. I have more significant priorities than just being young and rich.