Check out our monthly newsletter, planning, and tax tip resources!

Learn more

7 tips for accessing affordable capital in 2025

Female business owner in yellow shirt standing near a restaurant door.

If you've recently tried to secure a traditional bank loan for your small business, you've probably discovered just how challenging it's become. With rising interest rates and stricter lending requirements, more than half of small business owners now find current loan rates prohibitive—and a staggering 80% report challenges in obtaining affordable financing. 

The good news? Traditional bank loans aren't your only option. Smart entrepreneurs are increasingly turning to alternative funding sources to fuel their growth. In fact, according to the Federal Reserve Banks' Small Business Credit Survey, only 34% of businesses applied for traditional loans in 2021, down from 43% just two years earlier. 

If you're ready to explore beyond traditional lending, here are seven practical ways to access the capital your business needs to thrive. 

1. Research business grants—free money exists 

Grants remain one of the best ways to secure funding without repayment obligations. The Small Business Administration (SBA) and state economic development offices offer grants tailored to various industries, from technology to healthcare to sustainability initiatives.  

Don't overlook industry-specific opportunities either—nonprofits, corporations, and government programs often provide funding for niche markets, including women-owned businesses and green initiatives. The key to success? Prepare a compelling application that clearly defines your business goals, impact, and financial need. 

2. Consider SBA-backed loan programs 

When traditional loans feel out of reach, SBA-backed options can bridge the gap. The SBA 7(a) loan program offers long repayment periods and competitive interest rates, while microloans provide smaller amounts (under $50,000), perfect for startups and growing businesses. The SBA also offers valuable financing education and connections to lenders who understand small business needs. 

3. Tap into crowdfunding and peer-to-peer lending 

Modern technology has democratized funding through crowdfunding and peer-to-peer lending platforms. Reward-based crowdfunding on platforms like Kickstarter and Indiegogo lets you raise funds by offering perks to supporters.  

For businesses willing to share ownership, equity crowdfunding through services like SeedInvest connects you with investors. Meanwhile, peer-to-peer lending services like LendingClub match businesses directly with individual lenders, often offering more flexible terms than traditional banks. 

4. Connect with angel investors and venture capitalists 

High-growth businesses should consider investor funding. Angel investors—individuals who invest in early-stage businesses—can provide both capital and valuable mentorship. Websites like AngelInvestmentNetwork.com can help you connect with potential investors. For startups seeking significant funding to scale quickly, venture capital firms might be the answer. Either way, you'll need a clear financial model and compelling growth strategy to attract interest. 

5. Explore revenue-based financing 

For businesses seeking flexible repayment structures, revenue-based financing offers an innovative solution. Options include merchant cash advances (repaid as a percentage of future revenue) and subscription-based financing for businesses with predictable recurring income. These lenders favor businesses with reliable revenue streams, so steady cash flow is essential. 

6. Strengthen your financial foundation 

Regardless of which funding avenue you pursue, a strong financial profile improves your prospects. Focus on boosting your business credit by paying bills on time and lowering debt. Diversify revenue streams to demonstrate stability. Most importantly, maintain organized financial statements—detailed profit/loss reports and cash flow projections show lenders and investors you're a responsible steward of capital. 

7. Investigate industry-specific programs 

Don't overlook specialized funding opportunities in your sector. Professional associations often offer funding assistance for members. Programs specifically designed for minority or women-owned businesses can provide unique advantages. Additionally, many cities have local economic initiatives with grants and loans designed to support community businesses. 

The path forward 

With traditional lending becoming less accessible, taking a strategic approach to financing has never been more important. The funding landscape offers multiple paths—from grants to crowdfunding to investor partnerships. Remember, if your first funding request doesn't succeed, persistence pays off. Connect with other entrepreneurs who may have valuable funding connections and keep refining your approach. 

Need help preparing your financial statements for funding applications? Contact us today to ensure your business puts its best foot forward with potential lenders and investors.