Peer to Peer Lending – are You Looking to Start a Business
Starting a business is an overwhelming thought. One of the first things to consider is the funding you will need to get off the ground. In the past, you would need to either find investors, an angel investor, or attempt to get a business loan. Today, peer to peer lending is a new option that people are finding it as a viable option for funding a business.
The advantage of using peer to peer lending is the scale of your application. When you apply to a bank or approach an angel investor this is just one potential lender. If you use peer to peer lending, you are submitting a request for funding to thousands of potential investors. Everyone that is on a peer to peer lending site is a potential investor. Large sites like Prosper have a couple hundred thousand members. That is an exposure not easily achieved through the other models.
There are specific peer to peer lending sites that are designed for entrepreneurs. 40 billion is one of these sites. They offer a large range of funding from $1,000 to $99,000. It allows you to then sell your loan and business by giving you the ability to upload power point presentations and video. You can also invite people to invest in your loan to gain exposure and possible funding. To further help entrepreneurs, 40 Billion has business to business classified. This list could include attorneys, web development, and business cards.
The cons of using peer to peer lending for business loans are the limited amount of funds you could receive. If your idea is a large one and you need more than just a $100,000 then peer to peer lending might not be the route you want to take. Secondly, the loan will not be in the business’s name but in a person’s name. This person is then responsible for the loan regardless of how the business does. As a single entrepreneur this might be fine, but getting funding as a group means one person needs to take responsibility.
Peer to peer lending for small business has its place. For a person looking for just some start up money or just to expand, it could be ideal. Also, there is no guarantee that it will be funded so the borrowers need to sell it. If you are thinking about applying for a peer to peer loan be very clear on what it is for and what are your goals. This is a sign of a person who has direct and makes for a more confident business proposal.
About the Author:
To learn more about peer to peer loans visit Kyle’s website. There you will find great information about peer to peer lending
Article Source: ArticlesBase.com - Peer to Peer Lending – are You Looking to Start a Business