In order to obtain small business financing for your new company, there are many important questions that you will need to address. At the top of the list: Do you have what it takes to own/manage a small business? Because you will be your most important employee, a thoroughly assessed and objective appraisal of your strengths and weaknesses is critical.

Small business financing will require a sound business plan that will cover all of your bases. It will accurately define your business, identify your goals, and serve as your firm's blueprint for success. Basic components of the plan will include a current and pro forma balance sheet, an income statement and a cash flow analysis. Due to the plan's specific and organized information about your company and how you will repay borrowed money, a good business plan is essential if you want to be approved for business loans, as well as small business lines of credit.

When it comes to small business financing, committing your own funds is often the first financing step. It can be the best indicator of how serious you are about your business, and will give others the confidence to invest in your business. Therefore, you might want to consider a partner for additional financing.

While banks are an obvious source of funds, small business financing may come from other sources such as commercial finance companies, venture capital firms, local development companies, and even life insurance companies. Alas, once you've done the required legwork, produced a comprehensive business plan, and answered all the hard questions, it's time to sit down with a professional to see your goals come to fruition. The institution you go to for help will also have been part of your research, as finding the right financial specialist can prove challenging.