Tag : flow?

Cash Flow Story, cash flow business.#Cash #flow #business


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    Cash Flow Story What are your numbers telling you?

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  • Home Party Plan Training, Cash Flow Show, cash flow business.#Cash #flow #business


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    What type of accounts should I use for ATM businesses cash flow?

    #atm business

    #

    Back to search results

    What type of accounts should I use for ATM businesses cash flow ?

    I use the cash accrual accounting style for my ATM business. I cycle cash through my ATM’s that I have entered into my QB as owners equity originally. I am wanting to balance the checking account. When that money cycles back through to my bank account and gets electronically deposited what is it considered? Is it an “other assett” or what? Then when I withdrawl to load machines again what type of account should I use for the withdrawls, a “short term liability” account? I really need some clearity.

    You might say the cash is my reaccuring supplies.

    Why do you want to report this?

    I think I am tracking with Mistyblue. I have the income account for the surcharge fees that users of the machine owe me. The expense account for any fees for the particular bank where my money is cycled through. But what about the ST liability account. are you saying use this account type for the electronic deposits from user’s of my machine’s back to my account and use it for my withdrawls to load back into my machine. I thought I would need a “plus” and a “minus” sort of set up with the accounts?

    Recommended Answer

    2 people found this helpful

    This is how I have done this: I’ve set up a bank account for the ATM in qb as well a income account and I used a short term liability account. Of course a bank service charge account for the ATM.

    The short term liability account is the cycle account (withdraw and well as put back) – The income part I separate to its own income account. This way tracking income, expense, and your main cycle account. Which bottom line each rec balances. Note: I would check as well with your accountant on according to your area on sales tax requirements.

    Was this answer helpful? Yes No

    I think I am tracking with Mistyblue. I have the income account for the surcharge fees that users of the machine owe me. The expense account for any fees for the particular bank where my money is cycled through. But what about the ST liability account. are you saying use this account type for the electronic deposits from user’s of my machine’s back to my account and use it for my withdrawls to load back into my machine. I thought I would need a “plus” and a “minus” sort of set up with the accounts?

    1 additional answer

    No answers have been posted

    This post has been closed and is not open for comments or answers.

    More Actions

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    Business Valuation – Discounted Cash Flow #premium #business #cards


    #business valuation

    #

    Financial Calculators from Dinkytown.net

    Business Valuation – Discounted Cash Flow

    Business valuation is typically based on three major methods: the income approach, the asset approach and the market (comparable sales) approach. Among the income approaches is the discounted cash flow methodology calculating the net present value (‘NPV’) of future cash flows for an enterprise. As an alternative to the more abbreviated income capitalization approach, this methodology is more relevant where future operating conditions and cash flows are variable or not projected to be materially consistent with current performance levels.

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    For more information about these these financial calculators please visit: Dinkytown Financial Calculators from KJE Computer Solutions, LLC

    The estimated Net Present Value (NPV) of your business is NPV_VALUE.

    Your cash flow was estimated in two parts. First from your cash flow statement, and secondly from projecting future cash flows assuming a growth of EXPECTED_ANNUAL_GROWTH. We first calculated your estimated cash flow for year one from your inputs. An additional PROJECT_ADDITIONAL_YEARS years of cash flows were calculated assuming a EXPECTED_ANNUAL_GROWTH annual growth (for a total of PROJECT_YEARS). Each year’s estimated cash flow was then discounted by WEIGHTED_AVERAGE_COST_OF_CAPITAL (your weighted average cost of capital) for the number of years until the cash flow would be realized. The sum of all of your future discounted cash flows is the net present value of your business. **GRAPH**

    What else can I do to increase my valuation?

    • Increase your operating profits:
      You can directly impact your valuation by becoming more profitable. Increased efficiency and lower operating expenses can have a dramatic impact on your business’ valuation. Even relatively small increases in profitability can have a dramatic impact on your valuation.
  • Reduce inventory and accounts receivable:
    By reducing your inventory and accounts receivable, you can decrease the amount of capital that is tied up in your business. The net change directly affects your valuation.

  • Reduce your taxes:
    Very much like reducing your inventory, reducing your tax burden can directly impact the value of your business. A business that creates effective tax shields can be worth substantially more than one that doesn’t consider this important variable.

  • Effective capital expenditures:
    Target your capital expenditures to projects that increase your growth rate, or increase your profitability. While capital expenditures reduce your near-term cash flow, effective investment in your business can have a positive impact in your valuation.
  • Your cash flow statement:

    Business Valuation – Discounted Cash Flow Definitions

    NPV Value of your business This is the value of all of your future cash flows discounted in today’s dollars at your Weighted Average Cost of Capital (WACC).

    Expected annual growth This is the rate you expect your business to grow. This rate is only used on years 2 and above to estimate your future cash flow.

    Weighted average cost of capital (WACC) This is the cost of capital, or the interest rate, your investors require to put money into your business. Unless you are a Fortune 500 company with excellent business credit scores, this rate should be at least 12% to 25%. For small businesses that rate can be much higher.

    Years of cash flow to include This is the number of years that the projection will include in the value of your business. For example, if you include 100 years (the maximum) we calculate the present value of all future cash flows generated for the next 100 years into your business’ value. Entering a high number would assume that the business would continue with the current projections for that entire length of time. You may wish to reduce this projected period if you have a known end date for the business cash flows, or to make a more conservative estimate of the value.

    Operating profit This is your total profit before interest and taxes. This is often called Earnings Before Interest and Taxes or EBIT.

    Interest expense Total interest expense for the year.

    Interest income Total interest income for the year.

    Income taxes Total income taxes paid for the year.

    Depreciation and amortization If you had any depreciation on equipment or buildings enter those amounts here. They are added back into your cash flow.

    Change in accounts payable If you had a net change in your accounts payable, enter the change here. If you had an increase in accounts payable, your cash flow goes up. If you had a decrease in your accounts payable, your cash flow is reduced.

    Change in inventory If you had a net change in your inventory, enter that amount here. If you are holding more inventory your cash flow is decreased.

    Change in accounts receivable If you had a net change in your accounts receivable, enter that amount here. Reducing your accounts receivable by collecting money owed more quickly can increase your cash flow and your valuation.

    Other net change Enter any other net change in other assets or liabilities that impacted your cash flow for the period.

    Capital expenditures This is the amount you spent on capital equipment and buildings that you were not able to expense for the period. If you were able to expense the expenditure, it is already accounted for in your EBIT.

    Additional investment income Enter any other investment that increased or (decreased) your cash flow for the period.

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    KJE Computer Solutions, LLC’s information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues. More Information



    What type of accounts should I use for ATM businesses cash flow?

    #atm business

    #

    Back to search results

    What type of accounts should I use for ATM businesses cash flow ?

    I use the cash accrual accounting style for my ATM business. I cycle cash through my ATM’s that I have entered into my QB as owners equity originally. I am wanting to balance the checking account. When that money cycles back through to my bank account and gets electronically deposited what is it considered? Is it an “other assett” or what? Then when I withdrawl to load machines again what type of account should I use for the withdrawls, a “short term liability” account? I really need some clearity.

    You might say the cash is my reaccuring supplies.

    Why do you want to report this?

    I think I am tracking with Mistyblue. I have the income account for the surcharge fees that users of the machine owe me. The expense account for any fees for the particular bank where my money is cycled through. But what about the ST liability account. are you saying use this account type for the electronic deposits from user’s of my machine’s back to my account and use it for my withdrawls to load back into my machine. I thought I would need a “plus” and a “minus” sort of set up with the accounts?

    Recommended Answer

    2 people found this helpful

    This is how I have done this: I’ve set up a bank account for the ATM in qb as well a income account and I used a short term liability account. Of course a bank service charge account for the ATM.

    The short term liability account is the cycle account (withdraw and well as put back) – The income part I separate to its own income account. This way tracking income, expense, and your main cycle account. Which bottom line each rec balances. Note: I would check as well with your accountant on according to your area on sales tax requirements.

    Was this answer helpful? Yes No

    I think I am tracking with Mistyblue. I have the income account for the surcharge fees that users of the machine owe me. The expense account for any fees for the particular bank where my money is cycled through. But what about the ST liability account. are you saying use this account type for the electronic deposits from user’s of my machine’s back to my account and use it for my withdrawls to load back into my machine. I thought I would need a “plus” and a “minus” sort of set up with the accounts?

    1 additional answer

    No answers have been posted

    This post has been closed and is not open for comments or answers.

    More Actions

    People come to QuickBooks Learn Support for help and answers we want to let them know that we’re here to listen and share our knowledge. We do that with the style and format of our responses. Here are five guidelines:

    1. Keep it conversational. When answering questions, write like you speak. Imagine you’re explaining something to a trusted friend, using simple, everyday language. Avoid jargon and technical terms when possible. When no other word will do, explain technical terms in plain English.
    2. Be clear and state the answer right up front. Ask yourself what specific information the person really needs and then provide it. Stick to the topic and avoid unnecessary details. Break information down into a numbered or bulleted list and highlight the most important details in bold.
    3. Be concise. Aim for no more than two short sentences in a paragraph, and try to keep paragraphs to two lines. A wall of text can look intimidating and many won’t read it, so break it up. It’s okay to link to other resources for more details, but avoid giving answers that contain little more than a link.
    4. Be a good listener. When people post very general questions, take a second to try to understand what they’re really looking for. Then, provide a response that guides them to the best possible outcome.
    5. Be encouraging and positive. Look for ways to eliminate uncertainty by anticipating people’s concerns. Make it apparent that we really like helping them achieve positive outcomes.
    Do you still have a question?

    Ask your question to the community. Most questions get a response in about a day.

    Back to search results



    All About Cash Flow #business #insurance #quotes


    #business plan outline

    #

    All About Cash Flow

    While we are trained to think of business as sales minus costs and expenses, which is profits, we have to manage cash as well.

    Although cash is critical, people think in profits instead of cash. We all do. When you imagine a new business, you think of what it would cost to make the product, what you could sell it for, and what the profits per unit might be. We are trained to think of business as sales minus costs and expenses, which is profits. Unfortunately, we don t spend the profits in a business. We spend cash. Profitable companies go broke because they had all their money tied up in assets and couldn t pay their expenses. Working capital is critical to business health. Unfortunately, we don t see the cash implications as clearly as we should, which is one of the best reasons for proper business planning. We have to manage cash, as well as profits.

    A simple example
    One of the best ways to understand the dilemma of cash vs. profits is to follow an otherwise-profitable company going broke because it can t meet its obligations. This is a quick and simple example. It also leads us into the relationship between income statement, balance sheet, and cash.

    Start with $100, which we ll call capital. At the beginning of this exercise, your balance sheet has assets of $100—the money—and capital of $100. Assets are equal to capital plus liabilities. A summary of the simple financial statement at this point is shown in this first illustration, Starting Numbers.

    If you buy a widget for $100 and sell it for $150, you should end up with $50 profit, which is what your income statement covers. Sales minus costs are profit. You should have $150 in the bank. Now your balance sheet shows the same $100 in original capital plus $50 in earnings, which are equal to the $150 you have in cash as an asset. The next illustration shows you how the financials work after the sale.

    Buy another widget for $100 and sell it again for $150, and now you have $200 in the bank. Do it again, you have $250 in the bank. Your income statement shows sales of $450, cost of sales of $300, and profit of $150. The illustration shows your income statement and balance sheet at this point.

    Adding some realism
    Now go back a step and make the situation more realistic. For example, most sales of products to businesses go on terms, with the money due in 30 days. So if you sold that widget on credit you don t have $150 in the bank. You still have $50 in your bottom line, but now you have nothing in the bank. Instead, a customer owes you $150, which is what we call “Accounts Receivable.” Compare the Sell a Widget illustration to this next illustration, Selling on Terms. This is what really happens to the huge number of businesses that sell to other businesses.

    Knowing you can buy a widget for $100 and sell it for $150, you get your Widget supplier to sell to you on the same terms you sell, net 30, instead of for cash. Now you have $100 that you owe to suppliers, which is called “Accounts Payable.” You also have $100 worth of widget in inventory. This gives you the case in the following illustration, Buying on Terms, in which you are now poised to sell another widget and make more profit.

    You have an extra $100 in assets (the widget in inventory) and an extra $100 as liabilities (Accounts Payable), so you are still in balance. Also, you still have no money. Our next illustration shows the financial picture with sales to businesses on credit and purchase of inventory on credit as a short-term debt.

    Now the case is more like what you have with real business numbers, in which you have to manage your cash very carefully, and the amounts sitting in inventory and accounts receivable are significant.

    More realism: working capital
    Even in the case of the above illustration, the example is completely unrealistic. Where are the running expenses, such as rent, salaries, telephones, or even advertising those widgets? How would they affect the cash situation? How far would we get if we couldn t pay the rent or the telephone bill while waiting for customers to pay us? Furthermore, what supplier would give us a widget on credit when we have no history and no assets? What bank would loan us money in this situation? Banks do loan against inventory and receivables, but only to a certain percentage of total value. What was missing here, all along, was working capital.

    Important: In strict accounting terms, working capital is equal to short-term assets minus short-term liabilities. In real terms, however, working capital is the glue that holds your cash flow together. Get it into the bank before you need it, or you won t survive the unexpected.

    The following illustration goes back to the beginning of this whole example and does it right, with enough capital in the beginning to finance the company.

    Instead of starting with $100 as capital, this business looks a lot better with starting capital of $400. With this additional capital from the start, buying on credit and borrowing against assets is more realistic. In this scenario, working capital is up to $550. Now it has a proper input of working capital at the beginning. With even the barest of business plans, we could tell that $100 wasn t enough to get this business going.

    I hope the theoretical examples help make the concepts clear. If you followed these illustrations, you can see some enormous implications for running a business.

    Important: Every dollar in accounts receivable means a dollar less in cash. Every dollar of inventory is a dollar less in cash. Every dollar of accounts payable is a dollar more in cash.

    How LivePlan makes your business more successful

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    Let s take a look at those common hurdles and see how producing a top notch business plan sets your business up for success.



    Cash Flow Definition #most #successful #small #businesses


    #cash flow business

    #

    Cash Flow

    What is ‘Cash Flow’

    Cash flow is the net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company’s liquid assets are increasing, enabling it to settle debts. reinvest in its business, return money to shareholders, pay expenses and provide a buffer against future financial challenges. Negative cash flow indicates that a company’s liquid assets are decreasing. Net cash flow is distinguished from net income. which includes accounts receivable and other items for which payment has not actually been received. Cash flow is used to assess the quality of a company’s income, that is, how liquid it is, which can indicate whether the company is positioned to remain solvent .

    VIDEO

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    BREAKING DOWN ‘Cash Flow’

    The accrual accounting method allows companies to count their chickens before they hatch, so to speak, by considering credit as part of a company’s income. “Accounts receivable ” and “settlement due from customers” can appear as line items in the assets portion of a company’s balance sheet. but these items do not represent completed transactions, for which payment has been received. They do not, therefore, count as cash. (Note that the credit vs. cash distinction is not the same as it is in everyday terminology; proceeds from credit card transactions are considered cash once they are transferred.)

    The opposite can also be true. A company may be receiving massive inflows of cash, but only because it is selling off its long-term assets. A company that is selling itself for parts may be building up liquidity. but it is limiting its potential for growth in the long term, and perhaps setting itself up to fail. In the same vein, a company may be taking in cash by issuing bonds and taking on unsustainable levels of debt. For these reasons it is necessary to view a company’s cash flow statement. balance sheet and income statement together.

    Cash Flow Statement

    Often called the “statement of cash flows,” the cash flow statement indicates whether a company’s income is languishing in the form of IOUs – not a sustainable situation in the long term – or is translating into cash flow. Even very profitable companies, as measured by their net incomes. can become insolvent if they do not have the cash and cash-equivalents to settle short-term liabilities. If a company’s profit is tied up in accounts receivable, prepaid expenses and inventory. it may not have the liquidity to survive a downturn in its business or a lawsuit. Cash flow determines the quality of a company’s income; if net cash flow is less than net income, that could be a cause for concern.

    Cash flow statements are divided into three categories: operating cash flow. investing cash flow and financing cash flow. Operating cash flows are those related to a company’s operations, that is, its day-to-day business. Investing cash flows relate to its investments in businesses through acquisition ; in long-term assets, such as towers for a telecom provider; and in securities. Financing cash flows relate to a company’s investors and creditors: dividends paid to stockholders would be recorded here, as would cash proceeds from issuing bonds.

    Free cash flow is defined as a company’s operating cash flow minus capital expenditures. This is the money that can be used to pay dividends. buy back stock. pay off debt and expand the business.

    Real World Example

    Below is a reproduction of Wal-Mart Stores Inc.’s (WMT ) cash flow statement for the quarter ended April 30, 2015. All amounts are in million of U.S. dollars.

    Cash flows from operating activities:



    Looking for Stable Business Ideas? Here Are 12 Types of Companies With

    #cash flow business

    #

    Looking for Stable Business Ideas? Here Are 12 Types of Companies With Healthy Cash Flow.

    Data Featured Lists Editor

    November 24, 2014

    Land subdivision and funeral businesses may not be the sexiest small-business ideas when compared to, let s say, a web startup or a local coffee shop. But private companies in these fields tend to have the healthiest cash flow, according to new data from Sageworks. a Raleigh, N.C.-based financial data company.

    For entrepreneurs seeking new ventures. businesses with a track record of stability and solvency may be a good place to start. Sageworks used highest average current ratios to generate a ranking of 12 business types with healthy cash flow for the year ending Aug. 31, 2014. [See list below.]

    Cash flow is a leading indicator of financial strength because if a company has sufficient cash on hand, it will likely meet its short-term obligations — like accounts receivables and employee salaries — on time.

    Sageworks analyst Jenna Weaver says the businesses listed have the ability to pay their bills and they tend to, on average, have positive cash flow. She adds that while these businesses aren t necessarily fun or flashy, understanding why certain industries or business models are more inclined toward solvency than others is useful for any entrepreneur.

    Following land subdivision and death-care services, this year s ranking also includes grocery stores, real-estate businesses, clothing stores, liquor stores, gas stations, dry cleaning and laundry services, specialty-food stores, employment services, health and personal care stores, and investigation and security services.

    Land-subdivision companies divide land into plots to make selling the property easier. Weaver explains that its top ranking may reflect the strong real estate/construction market recovery since 2009.

    The rest of the results show themes: half of the list represented the retail sector. While giants like Walmart are known to operate with a low current ratio because of their ability to turn inventory quickly into cash, small private retailers may have difficulty predicting consumer behavior and may therefore stockpile inventory to meet any unexpected consumer demand. Weaver explains that the ability for these smaller establishments to then turn these inventory levels into receivables, and receivables into cash plays a big role. Also, she says a third of the industries on the list are service-related businesses, which usually have lower or no inventory needs.

    While every industry operates on different business cycles and models, entrepreneurs brainstorming on stable business ideas should always keep solvency in mind.

    Often, when businesses fail, they fail because of their inability to manage these ratios and generate positive cash flow, Weaver says.

    It s important to note that a current ratio that is too high is not always ideal. A company wants to keep enough cash or liquid assets available to be able to meet its short term debts, but it doesn t want to sit on too much cash or inventory, so that its assets are still being productive for the business.



    The importance of cash flow – Controlling cash flow for business growth

    #cash flow business

    #

    Controlling cash flow for business growth
    A CIMA case study

    Page 2: The importance of cash flow

    Cash flow is of vital importance to the health of a business. One saying is: revenue is vanity, cash flow is sanity, but cash is king . What this means is that whilst it may look better to have large inflows of revenue from sales, the most important focus for a business is cash flow.

    Many businesses may continue to trade in the short- to medium-term even if they are making a loss. This is possible if they can, for example, delay paying creditors and/or have enough money to pay variable costs. However, no business can survive long without enough cash to meet its immediate needs.

    Cash inflow and outflow

    Cash comes into the business (cash inflows), mostly through sales of goods or services and flows out (cash outflows) to pay for costs such as raw materials, transport, labour, and power. The difference between the two is called the net cash flow. This is either positive or negative. A positive cash flow occurs when a business receives more money than it is spending. This enables it to pay its bills on time.

    A negative cash flow means the business is receiving less cash than it is spending. It may struggle to pay immediate bills and need to borrow money to cover the shortfall. The distinction between cash flow and profit is shown in the example. In accounting, negative figures are shown in brackets.

    Liquidity

    Businesses aim to provide greater financial returns than the level of interest earned by simply placing the cash in a bank. They can also hold too much cash. Cash does not earn anything so holding too much cash could mean potential losses of earnings. The cash situation is referred to as the liquidity position of the business. The closer an asset is to cash, the more ‘liquid’ it is. A deposit account at a bank or stock that can easily be sold are liquid. Assets such as buildings are the least liquid. Liquid assets are those that are most easily turned into cash.

    Cash flow is always important, but especially when it is not easy to obtain credit. When the economy is in recession, financial service providers are reluctant to lend money. Borrowing also becomes more expensive as interest rates are raised to partially offset the risk of borrowers not paying back loans.

    Controlling cash

    Controlling cash is essential and management accountants deal with a range of cash issues:

    • ensuring that sufficient cash is available for investment by not tying up cash in stock unnecessarily
    • putting procedures in place for chasing up outstanding debts
    • controlling different levels of cash outflows in relation to the size of the business.

    For example, a car repair garage buys parts and tyres whilst a hairdresser buys shampoos, equipment and pays for power. In each case, if the business has cash problems it may be slow to pay its bills to suppliers. This creates further cash problems which spread throughout the economy. If small suppliers are not paid they may go out of business. This in turn may affect businesses further up the ladder.

    Chartered Institute of Management Accountants | Controlling cash flow for business growth



    Cash Crunch: What s the Best Loan for Your Small Business? #funding,bank

    #

    Cash Crunch: What’s the Best Loan for Your Small Business?

    Small-business owners are often struck by a kind of paralysis when looking for a loan: Where should I go? How much can I ask for? Will I succeed?

    It s no wonder fledgling entrepreneurs fret over these details — only half of small businesses that applied for financing in the first half of last year received any cash, according to a 10-state survey by the U.S. Federal Reserve Banks of New York, Atlanta, Cleveland and Philadelphia.

    A lot of business owners think it s hard to find financing, partly because there are so many lenders and types of loans from which to choose. As more nontraditional lenders such as Lending Club and Prosper help fill the gap in small-business funding alternatives, the potential for confusion just keeps increasing.

    Questions to ask yourself

    First thing you should do is breathe. All of those options may be confusing, but it makes it very likely there ll be a solution that works for you. To get started, take some time to ask yourself: What s my best option? One problem is that business owners tend to go with what they know, and often that means going for a traditional loan from a brand-name bank. But that can be a demoralizing experience. As a 2014 Harvard University analysis notes: The banking industry in the aggregate appears increasingly less focused on small business lending. The share of small business loans of total bank loans was about 50 percent in 1995, but only about 30 percent in 2012.

    Remember, what s right for you as a small business is a function of two things: (1) What do you qualify for? (2) What are your priorities? For example, do you want your cash as fast as possible, do you need a set amount of funding or do you have to have the lowest rate?

    The company I work for, NerdWallet, recently did a deep dive to compare small-business loans. examining key factors that help determine the best funding alternative. Here are the top factors that lenders will consider:

    • Age of your business
    • Revenue
    • Your personal FICO score
    • Size of proposed loan
    • How you plan to use the cash

    Together these elements help a lender evaluate the likelihood that it will get its cash back.

    Getting past the terrible twos.

    All the factors above are important. But there s another element to consider: Has your business reached its second birthday? If it has, you ll qualify for the widest range of credit options.

    Yes, two years is a magic number. Once your business makes it to 24 months, a whole range of new lending options — including Smart Biz SBA loans and small-business loans from Funding Circle and Lending Club — open up to you.

    That s because around 20 percent of all new businesses fail in the first two years, according to the U.S. Bureau of Labor statistics. About a third fail by year three and roughly half by year five. Lenders are less likely to back a business that hasn t proved it can survive its infancy when mortality rates are so high.

    Still, there are many lenders who will cater to businesses that are less than 2 years old; it s just that interest rates on their loans are generally higher.

    A note of caution: Every loan you apply for will cause a soft pull on your credit history and will affect your FICO score. And each lender has a wide range of interest rates — including some as high as 113 percent APR — and several also have a one-time origination fee based on a percentage of the total loan.

    It s hard to divine any of this taking a look at each lender s page and you ll face the difficulty of not knowing what you qualify for before applying.

    So we created a page that analyzes all these factors. It wasn t easy work — I had conversations with several lenders, pored over the fine print of lender corporate filings and, in many cases, applied for loans myself. (Keep in mind that you will face heavy marketing pressure once you go down this road. After I began my research, my voicemail was clogged with 50 follow-up messages from lenders.)

    According to our analysis, here s how alternative lending opportunities break down by years of business:

    (For a complete look at rates, requirements and our suggestions for appropriate use, visit our small-business loans breakdown .)

    What about your retirement funds?

    Personal savings and credit are by far the most common way startups are funded, according to Entrepreneur, followed by loans from friends and family. Bank loans were only the fifth most popular source of funding.

    But before you max out your credit card or call your family, have you looked at your retirement funds as an option?

    You might not know that you can use your retirement accounts as a tax-free source of business funding. Business owners invest retirement funds in their businesses as an equity investment rather than a loan, such that the funds don t need to be paid back to their retirement accounts. As a result, business owners avoid the debt and interest payments that come with other financing options, writes financial planner Mark Nolan. a member of NerdWallet s Ask An Advisor network.

    Typically, the business owner is able to access funds in 10 to 15 business days. For a time-sensitive business opportunity, quick access to funds can make all the difference, he adds.

    Of course, any new business venture is inherently risky — which means you might never see this cash again. That s a decision you could live to regret when retirement approaches.

    It may seem tough to fund a new business, but entrepreneurs have more options than ever before. Investigate them all before deciding on what s best for you.

    Cindy Yang

    Cindy Yang is head of the small-business group for NerdWallet, a personal finance startup. A former Goldman Sachs investment banking analyst, Yang teaches marketing for small-business owners at the San Francisco office of the U.S. Small Bus.