Starting a business is stressful enough without also worrying about how you’ll fund it. Even if you have savings and an emergency fund, you might find yourself putting off the inevitable for longer than you’d like because you can’t get your hands on the funds needed to actually get your company off the ground and moving toward profitability. Fortunately, there are a number of ways to finance your small business that don’t involve taking on more debt – or taking on any debt at all, if possible – as well as some creative ways to fund your startup without dipping into your own savings or sacrificing equity in your company as collateral. In most cases, the decision about how best to finance your startup will depend on your personal financial situation and the type of industry you plan to operate in – whether you’re in the early stages of planning or have already secured funding but need a new partner to join you as an equal partner in your business venture. Here are some ways you can finance a small business without going broke in the process:

Crowdfunding

Crowdfunding is an online fundraising initiative that allows entrepreneurs to secure capital from a large number of investors in exchange for equity or another form of compensation. It can be done in a number of ways, but the most common types of crowdfunding are equity-based crowdfunding and reward-based crowdfunding.While many people think of equity crowdfunding as a way to fund your business using the same type of investment capital that venture capitalists provide, there are a number of different crowdfunding models that make it possible for almost anyone with an idea and a network of followers to raise funds for their business.

Trade credit

Trade credit is another form of financing that can help you get the funding you need without handing over a ton of cash upfront. Like crowdfunding, trade credit is an online lending platform that allows you to connect with lenders and receive cash advances based on your company’s creditworthiness. You don’t have to provide a ton of collateral to receive a loan from a trade credit provider, and you can get a cash advance as little as a few thousand dollars. If you need more than that, there are a few different ways you can get it – including taking out a second loan or selling equity in your company.While trade credit is an excellent option for businesses that have a proven track record but need a little more capital to get started, it’s important to note that lenders generally require businesses to use their own cash flow as collateral.

Taking on partners

If you’re trying to fund your business without taking on additional debt or leveraging your own personal assets, you may be able to find prospective partners who are willing to invest in your company in exchange for an equity stake in the business. If you’re starting a technology or engineering company, this could be a great option for you. After all, there are plenty of investors who will invest in a company with great potential, but no revenue or track record.Finding investors who are willing to put their money into your company in exchange for an equity stake in the business is one of the easiest ways to secure funding for your startup. Keep in mind, though, that investors will expect you to be able to repay their investment with interest, and you should be prepared to make those payments on time. You also have to consider the fact that you’ll be giving up some control over your company, which means you’ll have to be extra careful to make sure the investor has the rights they need to protect their investment.

Co-marketing partners

If you’re not ready to take on an investor, another option is to reach out to potential partners who could help you fund your startup. This could include other businesses in the same industry, or it could include businesses that have products or services that you could use in your business. You’d make a deal with these partners by agreeing to market their products or services in exchange for a portion of the funds you need.While this is a great option if you’re trying to fund your startup without dipping into your own savings, it’s important to note that you’ll have to be able to provide a return on your investment. If you can’t make a profit, you’ll have to pay back the money you borrowed from your partners. This is why many companies that co-market products or services find that they actually end up making more money in the long run by investing in their own marketing efforts.

Taking on investors as silent partners

Another way to fund your startup without dipping into your own savings or sacrificing equity in your company is to seek out investors who would like to be part of your business but aren’t able to contribute a large amount of cash upfront. This could be a family member who wants to see their investment grow, or it could be a friend or colleague who has a lot of experience in your industry and wants to be a part of your company.In this case, you’ll structure your agreement with the investor so that they don’t actually receive any funds from your business but still have the option to make suggestions, offer advice, and participate in decision-making. You can even structure the agreement so that you and the investor split the profits equally.

Bottom line

There are plenty of ways to fund your business without taking on a lot of debt or sacrificing equity in your company. The decision about which option is best for you and your business is largely based on your personal financial situation and the investment you’re willing to make in your business.Whatever path you decide to take, remember that financing is a long-term commitment that comes with certain responsibilities. Before you commit to a loan or a line of credit, make sure you’re aware of all the costs associated with those types of investments.