Creative financing sources for startup


Are you hesitant about starting your own practice because you don’t know where you’ll find the money for collateral? Here are some creative solutions to your problem.

Consider one or more of these sources to get you going:

• Cash value of life insurance. If you have a whole-life policy that you or someone else has been paying on for some time, you may have some cash value built up. This is not the death benefit, but an amount in excess of the premium cost that has been put into a savings account for you. Consider using this cash value to use for collateral.

• Personal equity. If you or a co-signer has a home or property with some value built up, you want to consider a second mortgage or line of credit. Although the interest may be higher than a business loan, it’s a good way to get the amount you need. Don’t borrow more than the market value of the asset, though.

• Friends and family. Seek out friends and relatives who might be willing to give you money, either for a share of the profits (make them a shareholder) or a partnership (make them a limited partner with no ability to participate in daily decision-making). These loans can be informal so they don’t count against your credit rating.

• Vendor financing. That means financing equipment through the manufacturer. Many of these vendors have financing programs. The cost will be higher, and although they may say they don’t have interest rates, the fees they charge have the same effect.

• Borrow from yourself. Look around your home to see what you can bring to the office. If you have small children, use their toys for your children’s area. Bring your home computer to the office until you can afford one dedicated to the office.

• Buy used. If you look around in your community and online, you can find many sources of used chiropractic equipment, office furniture and technology, and other vital items you will need. Garage sales, auctions, and flea markets are also possible sources, as are online sales sites like eBay.

• Credit cards. This is a last alternative because many credit cards have very high interest rates, especially if you don’t have good credit. If you have had a low-interest credit card for some time, you may have a balance available to help with purchases of items like office furniture and equipment.

  • Chiropractic business expert Jean Murray provides insights into collateral, loans, and startup financing on her blog, “StudentDC Interactive,” at
  • For the basics on collateral and startup financing, see “Finding collateral for your practice startup loan” at
  • Before you start your search for used gear, read “Buying equipment and furniture” at

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