Entrepreneurs of startup enterprises are always looking for a way to raise funds. They need adequate sums of money to get the businesses up and running. Otherwise, they won’t be able to make their mark and fortune in the marketplace. Almost all of these aspiring proprietors may resort to bootstrapping to make ends meet. However, this course of action does get them very far over time. Eventually, they’ll have to obtain the cash they need from the financiers. Industry experts say these businessmen have 2 viable options open to them. They can issue equity to potential investors or resort to debt financing to meet their needs. These professionals suggest they should opt for the later.
Steven Rindner Main Street Advisors – Should entrepreneurs seriously consider debt financing?
Steven Rindner is one of America’s most popular finance professionals. He specializes in diverse fields such as debt financing, digital marketing, technology, and corporate acquisitions. The kind of customer services the professionals of this concern provides set the benchmark for others to follow.
According to Steven Rindner Main Street Advisors, many entrepreneurs have apprehensions of using debt to fund their businesses. However, many of their misgivings are unrealistic. It is one of the most cost-effective modes of finance. The strategy involves borrowing cash from reliable lenders in the market. These businessmen enter into an agreement with such financiers. They make a pledge to repay the entire sum of money with interest within a specific period. The proprietors have many options to choose from. These include a line of credit, merchant credit card, term loans from banks and cash advances. At the end of the day, these owners get the cash they need to conduct their operations. Moreover, they still retain ownership and control of their establishments.
These specialists point out the following 3 important benefits entrepreneurs can enjoy by opting for debt finance:
- Availing tax deductions
Many governments consider the payment of the principal and interest of loans as legitimate business expenses. They classify such costs as being eligible for tax deductions as and when entrepreneurs incur them. This is a fact which these businessmen cannot afford to ignore. It reduces their overall tax burden.
- Boost growth
Entrepreneurs need to realize that the proper use of long-term debt over time help to promote growth. They generally use the money to buy essential equipment, inventory or launch a marketing campaign. These businessmen just need to keep in mind an important fact. The income from the use of such assets is greater then costs they incur for taking such loans. This ensures they don’t face any working capital problems as they always have enough cash. It can take their organizations to the next level.
Many entrepreneurs don’t realize that issue equity shares in the market can be very expensive. These businessmen don’t just lose ownership and control of their establishments. They have to give their investors a portion of their future profits in forms of dividends. This is not so in the case of debt.
In the opinion of Steven Rindner Main Street Advisors, debt is a boon for entrepreneurs. They just need to look at the above 3 important advantages to know it is the right choice to make. It can improve their organization’s cash flow and profitability over time. This is a fact which they can’t afford to overlook.