So when you’re starting off in a social media agency or business, it’s usually difficult to have everything right the first time. Most business consultants recommend having 10-25% more capital than you already think you need in order to get your business actually on track.
Why Do You Need to Plan Your Business Capital?
In the age of internet hype and clickfunnels, the marketplace has generally become distorted in their relationship with managing money.
Perhaps this is one of the many reasons the United States economy now has one of the largest bull markets of all time at this point. However, you will have events that you don’t expect arise that will cause your desired projection of growth to slow, with capital being the only solution that is separating you from higher growth rates.
Now more than ever with United States loan rates are the lowest they’ve ever been in the history of our country (3-5%), most people whom aren’t privy to this knowledge are walking over metaphorical pay-dirt.
It’s one thing to leverage money from credit cards with, dare I say, almost criminally high APR rates. But it’s another thing to make your dreams work for you on 3% interest. Just to frame this up even better, realize this, in the 1980’s business owners were still taking loans even when they were as high as 20%.
Why is Leveraging Other People’s Money Smart for Your Businesses Growth?
Well the truth of the matter is banks are currently flush with cash to lend. The culling that took place in our last economical crisis of 2008, wiped out a majority of competition, and with the CFPB now in place making it harder for new banks to even form, the saying “the rich get richer and the poor get poorer” is more relevant than ever. Banks have less competition which means the institutions are growing virtually uncontested; in layman’s terms, they have more money to lend than they know what to do with.
Furthermore the most valuable thing in your business is your time. Assuming you have all of your numbers set up properly and a sustainable model, you know that the truth is this, the biggest separator of what most people would consider “wealth” is capital.
Leveraging Debt is Always a Good Idea
This capital is usually attained by most people within 25 or more years because they refuse to leverage debt to their benefit. Debt mind you, that is currently carrying only 3-5% interest rates. So when most business owners hit a wall inside their business there is only a series of questions they can ask themselves- is it the customer relationships, prospecting, product quality, marketing, sales team, or operations that can help grow my business to the next level, and outside of that- how long will it take me to get these systems in place at my current rate of growth?
You can even leverage money in expenses you may not have conventionally thought of before, such as purchasing a supplementary/complimentarily/rivaling business.
Imagine this scenario, you’re a social media marketer and want to make more money within your agency. One option you could take, is flat out buying your competitor with a loan you’ve received from a bank, or buying an SEO agency so you can add something onto your business that you currently don’t offer your clients.
The truth of the matter is this, having loans can be your best friend in a lot of ways, there are services out there to help you with finding large loans at a rate and terms that make sense with your current marketing efforts, and small business loans from Financer.com can help you fill in all of the missing gaps between where you want to be and where you’re stuck at now.