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There are several potential financing options available to cash-strapped businesses that need a healthy dose of working capital. A bank loan or line of credit is often the first option that owners think of – and for businesses that qualify, this may be the best option.

In today’s uncertain business, economic and regulatory environment, qualifying for a bank loan can be difficult – especially for start-up companies and those that have experienced any type of financial difficulty. Sometimes, owners of businesses that don’t qualify for a bank loan decide that seeking venture capital or bringing on equity investors are other viable options.

But are they really? While there are some potential benefits to bringing venture capital and so-called “angel” investors into your business, there are drawbacks as well. Unfortunately, owners sometimes don’t think about these drawbacks until the ink has dried on a contract with a venture capitalist or angel investor – and it’s too late to back out of the deal.

Different Types of Financing

One problem with bringing in equity investors to help provide a working capital boost is that working capital and equity are really two different types of financing.

Working capital – or the money that is used to pay business expenses incurred during the time lag until cash from sales (or accounts receivable) is collected – is short-term in nature, so it should be financed via a short-term financing tool. Equity, however, should generally be used to finance rapid growth, business expansion, acquisitions or the purchase of long-term assets, which are defined as assets that are repaid over more than one 12-month business cycle.

But the biggest drawback to bringing equity investors into your business is a potential loss of control. When you sell equity (or shares) in your business to venture capitalists or angels, you are giving up a percentage of ownership in your business, and you may be doing so at an inopportune time. With this dilution of ownership most often comes a loss of control over some or all of the most important business decisions that must be made.

Sometimes, owners are enticed to sell equity by the fact that there is little (if any) out-of-pocket expense. Unlike debt financing, you don’t usually pay interest with equity financing. The equity investor gains its return via the ownership stake gained in your business. But the long-term “cost” of selling equity is always much higher than the short-term cost of debt, in terms of both actual cash cost as well as soft costs like the loss of control and stewardship of your company and the potential future value of the ownership shares that are sold.

Alternative Financing Solutions

But what if your business needs working capital and you don’t qualify for a bank loan or line of credit? Alternative financing solutions are often appropriate for injecting working capital into businesses in this situation. Three of the most common types of alternative financing used by such businesses are:

1. Full-Service Factoring – Businesses sell outstanding accounts receivable on an ongoing basis to a commercial finance (or factoring) company at a discount. The factoring company then manages the receivable until it is paid. Factoring is a well-established and accepted method of temporary alternative finance that is especially well-suited for rapidly growing companies and those with customer concentrations.

2. Accounts Receivable (A/R) Financing – A/R financing is an ideal solution for companies that are not yet bankable but have a stable financial condition and a more diverse customer base. Here, the business provides details on all accounts receivable and pledges those assets as collateral. The proceeds of those receivables are sent to a lockbox while the finance company calculates a borrowing base to determine the amount the company can borrow. When the borrower needs money, it makes an advance request and the finance company advances money using a percentage of the accounts receivable.

3. Asset-Based Lending (ABL) – This is a credit facility secured by all of a company’s assets, which may include A/R, equipment and inventory. Unlike with factoring, the business continues to manage and collect its own receivables and submits collateral reports on an ongoing basis to the finance company, which will review and periodically audit the reports.

In addition to providing working capital and enabling owners to maintain business control, alternative financing may provide other benefits as well:

It’s easy to determine the exact cost of financing and obtain an increase.
Professional collateral management can be included depending on the facility type and the lender.
Real-time, online interactive reporting is often available.
It may provide the business with access to more capital.
It’s flexible – financing ebbs and flows with the business’ needs.
It’s important to note that there are some circumstances in which equity is a viable and attractive financing solution. This is especially true in cases of business expansion and acquisition and new product launches – these are capital needs that are not generally well suited to debt financing. However, equity is not usually the appropriate financing solution to solve a working capital problem or help plug a cash-flow gap.

A Precious Commodity

Remember that business equity is a precious commodity that should only be considered under the right circumstances and at the right time. When equity financing is sought, ideally this should be done at a time when the company has good growth prospects and a significant cash need for this growth. Ideally, majority ownership (and thus, absolute control) should remain with the company founder(s).

Alternative financing solutions like factoring, A/R financing and ABL can provide the working capital boost many cash-strapped businesses that don’t qualify for bank financing need – without diluting ownership and possibly giving up business control at an inopportune time for the owner. If and when these companies become bankable later, it’s often an easy transition to a traditional bank line of credit. Your banker may be able to refer you to a commercial finance company that can offer the right type of alternative financing solution for your particular situation.

Taking the time to understand all the different financing options available to your business, and the pros and cons of each, is the best way to make sure you choose the best option for your business. The use of alternative financing can help your company grow without diluting your ownership. After all, it’s your business – shouldn’t you keep as much of it as possible?

Wouldn’t you want to wake up when ever you want, spend more time with your children, hang out at home or go to the mall when ever you want? Wouldn’t you want to sleep in as much as you want or take a vacation if you want? Would you like to have more control over your life? Would you like to dictate when and how to work? If you answered yes to these questions, the solution is starting an online business. When you start an online business, you get a lot of business and flexibility and freedom. You pretty much own your time. You don’t have to worry about clocking in somewhere, working 9 to 5 or whatever the regular schedule is. You can pretty much do what you want. You can go offsite, hang out at Starbucks while working or work while enjoying the sun at the beach. The good news is that online business owners have done this ahead of you and they are doing it now. There is nothing stopping you from joining you. If you are still not convinced, here are the top 3 reasons why you should start an online business.1. Future-proof
It is easier to future-proof your online business than an offline one. With an offline business, your costs are fixed. Office rents, insurance and employee costs are fixed. The problem is when businesses go through up and down cycles, you might get crushed. In other words, you didn’t contingency-proof your business. With an online business, you have a lot more of flexibility with your costs so you can take more shocks. More importantly, you can adapt to these changes. So your business survives through the challenges.2. Your personal life
You can devote more time to your passions when you don’t have to stick to a schedule or report to a particular office. You can learn a new skill, go back to school, spend more time with your children, put in more time with your church or anything that is important to you when you have an online business. Your online business makes money while you are sleeping.3. Scalability and flexibility
Some online businesses are more scalable and flexible than others. Some allow you to work only once but make money many times over based on that one time you worked. For example, if you sell online books, you only worked once to write, but you make money many times over when people buy it. Do you see where I am going with this? So you have to figure out a way if you want greatest freedom and flexibility to scale up your business in such a way that you don’t have to work again to produce that income. There are many business models online that meet this need.

Every mother wants to have an easy, uncomplicated pregnancy and a healthy child. Unfortunately, more and more women experience pregnancy complications, such as anemia, high blood pressure, thyroid problems, diabetes, premature delivery, and low birth weight.More children are born with birth defects and many of those who appear normal at birth go on to develop health problems later in life.One in 10 kids will have ADHD, one in 150 will become autistic. Children are affected by anxiety, depression, and bipolar disorder. Kids develop type 2 diabetes, which was unheard of just 20 years ago.Experts agree that most of these problems can be reduced and even prevented by proper nutrition during pregnancy.Mother’s nutrition has an affect not only on the pregnancy and on the infant’s birth weight, but even on the risk of birth defects, pregnancy complications, maternal illness, and future diseases when the child becomes an adult.Nutrients reduce pregnancy complications and birth defectsStudies show that proper diet and nutritional supplements, such as fish oil, vitamins C and E can prevent mother’s illness during pregnancy and premature birth. Vitamin A and beta-carotene along with magnesium, fish oil, and zinc can reduce maternal mortality. Iron and folic acid reduce anemia. Calcium reduces the incidence of pre-eclampsia and high blood pressure.According to the Journal of Nutrition:”Numerous studies support the concept that a major cause of pregnancy complications can be suboptimal nutrition.”"Frequency and severity of pregnancy complications may be reduced through an improvement in the nutrient status of the mother.”"Maternal nutritional deficiencies …may be significant contributors to the occurrence of birth defects. “Maternal nutrition will affect the rest of the child’s lifeMedical research shows that good nutrition during pregnancy and childhood can reduce baby’s risk of future cancer.Proper maternal nutritional supplementation can reduce the risk of diabetes later in child’s life.Certain specific deficiencies (for example magnesium) can also increase the risk of future diabetes.Even the risk of future osteoporosis (in a baby when he or she becomes an adult) is determined by “maternal nutritional status during pregnancy” and especially by vitamin D deficiency, which is very common.Most pregnant women are deficientUnfortunately, most pregnant women are deficient in vitamins, minerals, amino acids, and omega 3 fatty acids.Omega 3 fatty acids, especially DHA, are part of the brain, central nervous system, and the retina. A baby needs them for normal development of the brain and the eyes.Premature infants are more likely to have ADHD, depression, and schizophrenia, because their brains did not have a chance to fully develop and incorporate all the DHA it needed. On the other hand, children of mothers who eat large amount of fatty fish have better intellectual development and higher IQs.The problem is that almost 90% of women do not get even the minimal amount of DHA. Many women are deficient in folic acid, despite food fortification. Deficiencies of magnesium, calcium, iron, vitaminsC, D, E, and many other nutrients are very common, which can jeopardize the health of both the mother and the baby.Don’t count on prenatal multivitamin – it does not workThe sad truth is that a typical prescription prenatal vitamin does not correct most deficiencies, which are extremely common in pregnant women.Prenatal multivitamin is a poor source of nutrients. All the ingredients are synthetic, so your body cannot use them the way it uses natural nutrients from food.Plus it is loaded with chemicals, such as crospovidone, FD&C Red No. 40 aluminum lake, hydroxypropyl methylcellulose, lactose, magnesium stearate, mineral oil light, polysorbate 80, sodium lauryl sulfate, stearic acid, syloid, titanium dioxide and triethyl citrate. Neither you nor your baby need these chemicals. They do not help, but can only cause harm.How can you be sure to have the most optimal nutritionEat a good diet. This means eat natural foods. Oatmeal is natural, but cereal made from oats that looks like little doughnuts is not. Steak is natural, but luncheon meat is not. Eggs are natural, eggbeaters are synthetic unnatural junk.In other words, eat food the way it is naturally produced and avoid processed, man-made foods. This usually means avoiding anything that comes in boxes, cans, and plastic packages and anything that has expiration date months from today. Real food spoils, junk food is loaded with preservatives, so it can last for a long time.Eat fruits and vegetables, nuts and seeds, berries, meat, chicken, lamb, eggs, cheese, butter, and any other natural food that you like. Seafood and fish are usually OK, but eat large fish (salmon, tuna, etc.) in moderation because of potentially high mercury content.Try to minimize soda, ice cream, cookies, white bread and white rice, most breakfast cereals, and any other processed foods.But even eating a good diet may be leave you deficient in important nutrients. That is why I recommend nutritional supplements.As I mentioned, prenatal vitamins that you doctor prescribed is nothing but junk. It is a combination of synthetic chemicals, some of which may even be harmful for the developing baby.You should take only supplements that are made from real food. There is a company called Standard Process that has been producing food-based supplements since 1920s. They grow fruits and vegetables on their own certified organic farm. They dehydrate them using a patented low-heat high-vacuum process that retains all the nutrients. Think of it as turning a grape into a raisin. Raisins have all the same nutrients as grapes, except for water.They also use organ meats (liver, kidney, etc) from organic cows because they have very high nutrient content. They combine different ingredients to create various nutritional supplements. There is nothing artificial, no preservatives, no chemicals, only real food with real nutrients.It is never too early or too late to start. Whether you are just planning your pregnancy or are in the 3rd trimester, you need proper nutrition at every stage.This is the program I recommend to my patients:· Catalyn – a natural multivitamin/multimineral made from 12 different foods· Folic Acid B12 – for extra folic acid and B12· Ferrofood – natural organic iron· Calcium lactate – natural calcium and magnesium from beats· TunaOmega oil – naturally pure source of DHA and EPA, guaranteed free of mercury, PCBs, and other chemicalsAll these are from Standard Process. They are only available through health practitioners, so go on their web site and find a doctor near you. Or you can call my office at 718-769-0997 if you cannot find anyone locally.The important point is this. If you want to have a healthy, uncomplicated pregnancy and a healthy, well-developed baby, eat real food and take food-based nutritional supplements.