Start a Successful Business (Inc.)

IT’S ALWAYS DAUNTING TO RAISE money for a startup. Most entrepreneurs are forced to dive into their own pockets for the cash to start a business, as few lenders or investors want to bet on an unproven startup. Newbie entrepreneurs often cobble together funds by combining their own savings with a few other sources (such as loved ones, credit cards, or home-equity loans) in the early months or years. Those who don’t have enough cash sometimes try crowdfunding sites. It remains difficult or downright impossible for startups to obtain bank loans. That’s because banks and credit unions are risk-averse and don’t want to take a chance on a startup until much later, when the business has a track record and financial statements to prove it.

A small number ...