Starting a business is tough and, for many entrepreneurs, one of the most daunting challenges is raising start-up capital. Gone are the days of pitching investors with hot new technology ideas. Today, entrepreneurs are much more likely to dive into their own pockets and hunker down for a battle to start up and stay alive. But if you don't have the cash in your wallet, what do you do? Luckily, there are still options for funding new companies, but finding and securing the cash will take careful research, good negotiating skills, and, above all, an unflagging commitment to launching your new business.

Start your capital search with a good business plan that shows investors and lenders your company's potential. Follow that up with a thorough knowledge of the resources available and a determination to make your business a reality, and you should be on your way to uncovering a source that fits your new business's cash needs.

Survey the Field

Where Do You Go?
Small-business expert and former Inc writer Tom Ehrenfeld discusses the various financing options entrepreneurs have in this excerpt from his book, The Startup Garden.
20 Tips for Finding Money Now
Small-business finance expert and former Inc finance editor Jill Andresky Fraser explores 20 ways for financing a business in this 1999 article. Some represent ways to finance new start-ups, while others help established businesses find working capital.
How to Finance Anything
Though funding isn't as easy to secure as Jill Andresky Fraser mentions in this 1998 Inc classic, the article does offer an overview of some resources that entrepreneurs frequently pursue, including private-equity investors, banks, venture capitalists, and non-banks. Don't miss the common pitfalls to avoid when seeking capital.
Start with Nothing
Greg Gianforte thinks he knows the single best way to launch a business. Here's his secret: "Bootstrap it."
The Pita Principle
Just how low can you go when bootstrapping your start-up? The founders of Stacy's Pita Chip Co. can tell you.
Great Companies Started for $1,000 or Less
Profiles of seven entrepreneurs who transformed start-up capital of $1,000 or less into companies with revenues of $1 million or more.

Inspiration from the Inc 500

Starting businesses with little or close to no money at all seems to be the norm for many recent Inc. 500 companies.

The Numbers Game
According to the class of 2002, you don't need a whole lot of money to start a business. Many of the 2002 CEOs launched their businesses with $10,000 or less. And more than a third of those bootstrappers started with less than $1,000.
A Little Goes a Long Way
When it comes to the 2002 Inc 500, start-up capital is not the leading predictor of success.
Start-up Springboards
No cash? No customers? That didn't stop the founders of these 2000 Inc 500 winners.

Tapping personal ties to raise cash for a company that's either too new or too small to get financing elsewhere is an age-old formula that still makes sense. But here's one risk too big to ignore in today's highly competitive capital marketplace: if you don't follow professional standards in structuring and documenting "F&F" loans or equity arrangements, your sloppiness will likely come back to haunt you.

That's because if and when your company grows to the point at which it can credibly approach banks or professional investors for funds, their lawyers will examine your corporate capitalization structure with a fine-tooth comb.

(Excerpted from "20 Tips for Finding Money Now," Inc. magazine, March 1999)

Blood Money
Hitting up family and friends is the most common way to finance a start-up. It's also the riskiest.
Borrowing: Avoiding Problems with Family and Friends
When entrepreneurs borrow start-up capital from family members or friends, it's best to prepare for the worst -- before it happens.
Borrowing Money for Your Business
Whether you borrow money from a bank or someone you know, you should sign a promissory note--a legally binding contract in which you promise to repay the money.
Three Steps to Borrowing from Family or Friends
Keeping the relationship professional is the key to successful borrowing from close acquaintances.

Bank financing isn't impossible. Use this advice to increase your chances of securing a bank loan.

You're Approved
Help lenders understand your industry to improve your chances of securing a loan.
Small Business Lenders Want to Hear the Good and the Bad
Whether your business is struggling, or making money hand over fist, it's important that both situations be communicated to a lender.
Answering the Tough Questions
A bank will scrutinize your past business performance. Are you prepared to answer the tough questions when your banker asks them?
Historical Finance and Its Relevance to the Lending Process
Why lenders focus on it and what you need to be prepared to discuss.
A Borrower Be
Tough economies and easy credit usually don't mix. So why are banks falling all over themselves to lend small businesses money?
Who Needs a Bank Anyway?
Nontraditional lenders are emerging as a real alternative to bank financing for growth companies.
The VC on the Corner
Think the most you can expect from a bank is a line of credit? You might be missing out on the emergence of banks' private-equity arms.
The Few, the Proud, the Bankable
Can you get a bank loan from the get-go? It's tricky, but these entrepreneurs did it. Here are their tips for securing a line of credit for your start-up.
Understanding Loan Covenants
Getting a bank loan? Take these simple steps to make sure you understand the fine print -- before you sign a loan agreement.
When Bad Loans Happen to Good Entrepreneurs
Accepting a loan from the most respectable source of business financing -- a commercial bank -- is a mistake for some entrepreneurs.
The Lowdown on Business Loans
If you're seeking a loan for your business, make sure you understand the basics.
Getting into the Mind of a Lender
When trying to get a loan, it helps to view things from the lender's perspective.

Look into Government Programs

Some entrepreneurs say government programs are easy to secure financing from; others say steer clear of them. Regardless of the opinions, if you're serious about your capital search, you shouldn't overlook government programs and the U.S. Small Business Administration (SBA).

The SBA All-Stars
A look at the Small Business Administration's rankings of the best field offices turns up some surprises. The agency's western outposts tend to outperform their East Coast peers. Though the rankings are based on a number of factors, the chart below follows the money, listing offices' key lending statistics.
Seed Capital for Farm Communities
Financing for rural businesses.
Seed Capital From Uncle Sam
Where can you find cash in a credit crunch? OLI Systems Inc., a New Jersey software company, looked to the government's National Institute of Standards and Technology for funding.

Angel investors will not only share their money; they're also great sources of knowledge for fledgling businesses

Earning Your Wings
Angel investors are getting tougher. To land seed money, you should, too.
Angels in America
Here are some profiles of a select group of angel investors, including links to their websites.
SLIDESHOW: Angels with Angles
Here are a number of high profile angel investors and what they consider to be good investments.
Angels with Angles
Angel investors are changing. Here's what they're looking for, how they operate, and (because the devil is in the exit strategy) what they expect for their money
Who exactly are angel investors?
Guy Kawasaki defines angel investors, and when and how an entrepreneur should seek them out.
What does it take to impress an angel investor?
Rhonda Abrams shares her views on the kinds of businesses that attract angel investors.
Seven Steps to Heaven
Funding for entrepreneurial businesses has completely dried up, right? Wrong. Angel investors -- long a tried-and-true source of capital for young businesses -- have not hung up their wings.
Angel Financing: Dos and Don'ts for Entrepreneurs
Any entrepreneur who hopes to raise capital from individual investors, so-called "angels," should be prepared with a presentation, business plan, list of potential angels, and outline of the opportunity his or her new venture affords.
Local Area Network
By opting to keep her high-tech start-up, Thermagon Inc., in Cleveland, founder Carol Latham was able to leverage her local ties to build a sophisticated network of investors and employees.
Making Friends: The Name of the Angel Game
Looking for individual investors, known as "angels," to finance your company? Then heed the adage, "It's not what you know but whom you know."
Directory of Angel-Investor Networks
Need help getting started in your search for angel funding? Here's a directory of angel networks in the United States, broken down by geographical area.

Get Creative

Banks and investors aren't the only ways to fund a business. Check out these unconventional resources that some business owners have used.

Getting Money for Good Ideas
Business-plan competitions tend to draw cutthroat b-school students. But entrepreneurs with lofty social goals are also increasingly entering the fray--and winning.
How to Win Big and Get Ahead Fast
Once academic exercises for eggheads, college business-plan contests now offer competitors the chance to win sizeable chunks of cash and launch a business. No surprise: Entrepreneurs have begun to horn in on the action.
Capital Customer
Use your first customer to help fund your new business.
Financing Your Business: A Case for Using Some of Your IRA, SEP, or 401(k)
Tap into your retirement kitty to fund your business venture.
Seed Capital: The 12-Step Program
The secret to funding a start-up, one owner learned, is to tap every capital source you can.
From Steak Holders to Stakeholders
The story of how an entrepreneur turned to his community to raise funds to open a supermarket.

Use Credit Cards

Plastic can jump-start any business, but use it wisely.

Charging Ahead
Half of all start-ups are financed with credit cards. But be careful: Sky-high interest could bury you for years.
Credit Where Credit Is Due: Using Plastic to Finance Your Start-Up
Financing your business on credit cards may save time and allow you to keep business expenses separate from personal ones. But without careful management, credit cards can quickly put your start-up on the sidelines.
Committing Your Nickel
Starting a business usually involves committing personal finances. To fund the business and keep a roof over one's head, the entrepreneur must maximize assets, minimize expenses, and use credit judiciously.
House of Cards
Ten tips for keeping your credit in check.