Obtaining the funds needed to launch and grow a new business can be challenging for entrepreneurs in California and around the country. Traditional lenders are often reluctant to provide credit to commercial ventures that have yet to establish a secure market position, but other sources of cash could be available to the owners of fledgling business. Accelerators and incubators may provide much-needed capital when banks are unwilling to lend, and both of these options provide guidance and advice as well as funding.
Incubators assist entrepreneurs when they have an idea for a new business. Incubators generally provide capital and advice until a new commercial venture is ready to launch, and the money available is often used to purchase initial supplies and rent office space. However, gaining access to an incubator can be difficult especially if a completely new product or service will be offered, and business owners who do not have a track record of success or significant experience in the field concerned may face an uphill battle.
Entrepreneurs turn to accelerators when their businesses are already up and running and they need capital to grow or address operational issues. While incubators generally work with business owners for between one and five years, accelerators usually provide assistance for six months or less. However, entrepreneurs can expect to receive valuable feedback from experts during this time as well as money that can be used to expand their businesses. Some companies offer both incubator and accelerator services.
Attorneys with experience in business formation and planning can often advise entrepreneurs about the various options available to launch and grow new companies, and they could also explain how forming a corporation or limited liability company can protect personal assets from business creditors and lawsuits. In addition to helping entrepreneurs to choose the appropriate business entity, attorneys could help them to obtain any permits and licenses they may need.