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Flexibility, being your own boss, following a passion — there are endless reasons to start your own business. And since they employ more people nationally than their larger counterparts, small businesses also play a key role in driving economic growth.
On the flip side, 82% of small businesses will close due to lack of capital, according to a U.S. Bank report. So, to transform your dream into a viable operation, it’s important to set your business up for success–starting with strong capital.
Before you shop for funding, make sure your personal credit is in good standing. Ideally, you want to have a credit score of 720 or higher to secure the most desirable rates. If your credit needs some help, consider working with credit repair company to improve it, and process any disputes promptly.
Once you’re ready to secure capital, remember to diversify your sources since funding from multiple sources will mitigate your risk should one of the pipelines close, meaning you can keep the business going while you look to replace that one channel.
With countless options available, here are some places to start:
Applying for a new business loan is rarely a direct path, so if your application is rejected, remember you always have the option to review the reason and reapply with an amended application.
This article originally appeared on Credit.com.
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