If you want to turn your dream of owning and running a small business into a practical reality, you are going to need a substantial flow of cash. Your first inclination may be to approach a national bank for financing, aware that it has significant resources. Because such a bank requires you to present an extensive track record of business success, however, you will likely leave the building empty-handed. Instead, consider the following sources outside the mainstream — mostly alternative-financing resources — for your startup funding. 

Small Bank

Just because a large bank will likely throw up barriers, a small regional institution may be open to working with you, though regulations make that outcome only a possibility, not a guarantee; technically, community banks are nontraditional financial sources as opposed to alternative ones. Networking can pay off in this instance. If you have developed a relationship with bank executives, they can negotiate funding or use their knowledge to steer you in the direction toward other funding sources.

Other Community Resources

Nonprofit institutions often look for ways to partner with outside businesses; doing so advances their causes and looks good on their prospectuses. The company has to offer a service or product of value to the institution, however, one that meets its mission. Be prepared to write grant requests and meet with leaders at the organization.


Not too long ago, the thought of appealing to the public at large for small business financing would have seemed alien. In recent years, crowdfunding, where individuals or entities contribute to support a need, has become a viable financial resource in a number of situations. As an entrepreneur, you can use a crowdfunding platform to kick off your idea. Because some contributors see their involvement as an investment, you can expect to provide a return, so be prepared to offer incentives if necessary.


Beyond those in crowdfunding, you may also consider formally embracing outside investors. The benefit of this approach is that you may not be expected to make repayments on the financing. Again, the investors expect to reap the benefits of your success. To do so, however, investors play the role of a business partner. Thus, you lose some controlling interest in your company, a position that may mean you do not make company decisions without partner consensus. 

You can start a new small business without support from other entities. In particular, you may need to be resourceful when initially seeking small business financing. If you are willing to explore a range of options, you can find the solution to your funding that sits just outside the box.