It takes a lot of time, effort and money to get your business out of the startup mode and move on to the next level. If you have been able to achieve that with very little debt on your books, then you can be sure that it’s time to shift gears and aim higher. That’s business, and you have to ride the raging bull or face the lurking bears that are waiting to devour you. On a more serious note, your business needs an ever-larger infusion of capital investment to leverage the growth opportunities. This is when you can consider mezzanine business capital loans to fund your growth story.
Now, what are mezzanine loans and how can they help your business scale up to higher levels of competition? These are unique funding solutions that combine both the debt and equity components of funding. Don’t get all worked up hearing about the equity component of such funding. It all depends on how the funding option is worked out and in any case it doesn’t materialize unless you want it. You need to realize that as your business grows, your funding options also grow and equity funding is one of them. Won’t you like your company’s stock to trade on Wall Street one day? Stock is nothing but equity; so get used to trading in your equity if you want your business to grow really big.
What do you want a mezzanine loan for?
It is true that as your business grows, the role of equity will play a proportionately bigger role in your business funding. However, equity funding will need alert handling which is another bit of reality that you must deal with as your business grows.
A mezzanine loan comes packaged in the garb of debt funding but it has provisions of equity conversion of the debt in case of default. Hence, set your business growth plans realistically and don’t just agree to any US business funding beyond what you actually require.
Have you figured out how much you want to scale up?
If you are sure about the growth path of your business and have a clear view of the milestones on the horizon then you are best suited to go for mezzanine business funding solutions. That’s when you can be sure of the amount of money you require and how you intend to pay it back.
On the other hand, you could come across suggestions from the lenders for taking a larger loan. You need to remember here that it is you who decides how much debt you want to accumulate especially where there is a chance for such alternative business loans to get converted into equity if you default.
Are you buying out a partner or taking over a competitor?
In the competitive landscape, many will flounder and fall behind while others race ahead. If you find yourself among the latter group, you could soon be in a position to buy out a stagnating competitor. That would require serious funding by alternative lending companies.
On the other hand, you could have a partner who wants out of the deal s/he entered with you and is planning to sell his/her stake. In case you don’t buy out this partner, s/he might sell his/her share to someone else. You can access mezzanine alternative business funding to buy out your partner and gain more control of your business.
For more information regarding Mezzanine Loans: https://www.altfunding.com/services/mezzanine-loans