Businesses are increasingly turning to non-traditional loans to address various financial challenges and opportunities. Liquida Capital is one such lifeline for companies of all sizes needing a refuge during tough economic circumstances.
The company is owned and managed by Andre Dowdell Jr., who has made it his business to help other businesses. He does this by helping companies secure a stable financial future and offering monetary support through Liquida Capital's services.
Andre explains why companies are turning to non-traditional loan systems, such as Liquida Capital, and how he and his team have sought to meet these needs.
The Power to Launch
"When an entrepreneur or start-up launches and announces its presence to the public, this requires significant capital," he says. However, a successful launch sets the stage for greater things to come, and businesses with sufficient capital are able to embrace this milestone in their company's timeline with excellence. A launch can include many things, such as initial set-up costs, product development, and advertising to enter the market.
Capital is also needed for existing businesses to expand. As with launches, the decision to expand into new markets requires increased financial input as it involves increased advertising, product updates, and development, as well as the costs associated with purchasing new premises and hiring new staff.
Securing Day-to-Day Success
Andre explains day-to-day tasks of companies require sufficient working capital. "It's not just long term goals which require revenue. Everyday tasks can leave a dent in a company's budget, and when these everyday needs are not met, the company isn't able to grow and focus on long-term goals."
Maintaining sufficient working capital is essential for daily operations. Many businesses seek funding to manage cash flow gaps, cover unexpected expenses, or invest in short-term opportunities. Traditional bank loans may not always provide the flexibility or speed required, leading businesses to explore alternative financing options.
Studies by LendEDU cite that the most frequent reason for loan requests from business owners in 2021 was to pay operating costs.
Accessing the Tools to Success
Andre relates how he first entered the corporate world through launching a car-related business, and so he learned early on in his career how invaluable the correct equipment is for a company's effective functioning. "Most businesses require very specific equipment to be a success," he says.
Acquiring new equipment or inventory is a common reason that companies seek financing. Non-traditional loans, such as equipment financing or asset-based lending, allow businesses to purchase necessary assets without depleting cash reserves.
Debt Consolidation
According to recent reports by the Federal Reserve Banks' Small Business Credit Survey, a staggering 59 percent of small businesses confessed to being in 'fair or poor financial condition.' Findings by LendEDU confirm these statistics, saying that about a third of company owners (32 percent) asked for a loan to refinance or pay off debt in 2021.
Businesses with multiple existing debts may opt for consolidation to simplify repayments and potentially reduce interest rates. Alternative lenders often provide more flexible terms for consolidating various liabilities into a single loan.
Accessible Financing Through Non-Traditional Loans
Andre says that he believes many companies, including start-ups and entrepreneurs, don't reach out for help when they need it because they believe their applications will be turned down. They also don't necessarily realise how many financial support options are available to them.
"Some businesses, especially startups or those with less-than-perfect credit histories, may face challenges obtaining loans from traditional banks," he explains.
Non-traditional lenders often have more lenient eligibility criteria, making financing more accessible to businesses seeking help.
According to Finder, 32 percent of small businesses apply for loans at non-bank lenders. This is because of the small businesses asking for loans from traditional major banks, 77 percent are turned down.
Liquida Capital offers businesses flexible and accessible financing solutions to meet various needs, from managing daily operations to funding growth initiatives.
Join the Conversation