Communications Funding: Getting What You Need To Make Your Small Business Grow

Your company needs money quickly. You can borrow money, or sometimes qualify for federal grant money, but there's a new way to get the communications funding your business needs. It's called communications funding. It offers a great alternative to banks and traditional lenders, who are wary of lending to telecoms.

The Trouble With Communications Financing

What makes it tough in this industry is that most traditional lenders will not sport you the cash to start up a telecom. Communications funding is hard to come by because banks and other lenders don't consider you to have any assets. In other words, you can create a telecom industry practically out of thin air, and thin air has no collateral.

Basically, banks don't like risk. The telecom industry is considered risky because so many small companies have launched and then failed. There's no collateral that the bank can seize if things don't work out and you are unable to pay. For this reason, you have to look for alternative sources for your communications funding.

Where To Find Sources

Rather than heading for a bank, look for a credit company that specializes in high-tech industries. There are lenders who specialize in this field. They offer loans to start-up companies, understanding well the unique challenges that face telecommunications companies.

Ask Uncle Sam

You may be able to qualify for federal money to launch your business. Periodically, the government offers money to start-ups in order to stimulate the industry. The telecom industry has been in a major crunch the last few years. The heyday of easy money pouring in is over, and in order to help a much needed industry, the government gives grants. This is a tough process though; there are lots of forms to fill out, papers to submit and deadlines to meet. Still, it's worth it to get free money in the end.

Turn Your Old Invoices Into Cash

The most viable option for telecoms is to sell old uncollected invoices. This is called "communications factoring." Factoring means selling your invoices to another company, who then collects the debt. They pay you a majority of the sum up front and the rest later, and they get all the interest. It's a win-win situation, and it's money that you don't have to pay back.

Factoring is a great way to get the communications funding that you need. It's simple and it's not a loan, which means that the money is yours to keep. It offers a great way to get the fuel your telecom needs to run smoothly.