By Sharon Hotz | Business banking manager and vice president, Northwest Bank 

This is it: The time has arrived. You are ready to launch your business. You’ve taken your dream — your passion — and developed a business plan and are ready to make your dream a reality. But first, you need to determine how to get funding.

Funding your business in the startup phase can be challenging. Thankfully, there are a lot of options to consider. To determine the right funding path for your business, look at your estimated startup costs. What will you need to operate your business? Will you need to purchase inventory or equipment? Will you need to lease or purchase a storefront or office space?

Answering these questions will help you decide which resources to tap into for funding. Not sure what funding options are available? I’ve compiled a list of funding resources available to startup business owners.

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Small business loan
A small business loan is one way to gain the financial support you need. Before applying for a small business loan, first ask yourself, “Am I ready for a bank loan?” Or put another way, “Am I ready for a monthly fixed payment?” It’s important to examine every purchase that will require additional debt. Debt can be a wonderful thing that you can leverage and use to increase your cash flow and grow your business. But when it’s misapplied or not prepared for, it can put your business in a financial bind.

There are many types of loans you can apply for. Have your business plan and financial projections in hand when you meet with a commercial banker. This information helps guide the conversation about the type of loan your business might need and what your business can afford. If you are a veteran, minority or woman in business, there are many opportunities for loan guarantees through organizations like the Small Business Administration.

Support from family and friends
It’s not uncommon for startup business owners to turn to family and friends for funding. This is a good resource to consider if you are not ready to go the traditional bank loan route. Your family and friends are your true believers and champions and may be interested in learning more about your business and how they can support you.

As you prepare for these conversations, think about how much money you want to ask for. It’s not a bad idea to start small. Instead of asking for the whole amount you need, maybe ask for enough funding to get you through the first three or four months of business. If you are planning to pay back the financial support you receive, it’s important to explain the potential risk involved and agree on a payment plan.

Crowdfunding
Crowdfunding brings a community of people together online to commit money to a project or business. This form of online fundraising has grown in popularity over the last 10 years. Two well-known crowdfunding websites are Kickstarter and Indiegogo. Since Kickstarter launched in April 2009, the site has helped successfully fund over 150,000 projects. iFundWomen is a crowdfunding platform specifically for women-led small businesses and startups.

If you’re unsure how to successfully start a crowdfunding campaign, Indiegogo provides entrepreneurs with a free crowdfunding field guide that walks through every step of a successful project.

Bootstrapping
Another option to consider is funding the startup yourself. Keeping your full-time job while you get your business off the ground allows you to have steady income during the startup phase. This is not an easy strategy and probably includes a lot of late nights, but once your business becomes self-sustainable you get a sweet — and well-deserved — reward at the end.

Angel investors
An angel investor is a person or group of people who invest their personal financial resources into a business. In return, the investor(s) receives equity or shares in the business that is not publicly traded. If you are looking for a network of angel investors, contact your lawyer or accountant. They may know angel investor networks in your community to refer you to.