Borrow money for your business with a financing mix

Do you want to grow your business or are you starting a business? Do you need to borrow money for this? Increasingly, you can no longer borrow the total amount from one financier. You need different forms of financing at the same time. For example, you supplement your own money with a loan from family and friends and with a loan from the bank or other financiers. This is called a financing mix. Discover which credits, loans, and financing you can mix and what you need to arrange.

Banks are typically open to mixing financing types. Because with a financing mix, you not only spread your own risk, but also that of your financiers.

Check the conditions

Are you going to borrow money for your business? Familiarise yourself with the conditions and interest rates of each credit provider. Also, research which forms of financing are suitable for you and your company. Christiaan Hazelaar, an adviser from the KVK Advice Team, receives daily questions from entrepreneurs about financing applications. Hazelaar often refers them to alternative financiers. “In practice, it is easier to borrow money from an alternative financier first. With such a loan in hand, you can then look for financing from the bank.”

Make a plan

Before you start looking for and mixing financing types, create a clear plan and a financial budget. Financiers want to know that your idea and plans are in order before they give you credit. Back up your plan with figures and a realistic earning model. And indicate how much money you need for this. Look at how you can split the amount. Present the amounts you want to borrow to different financiers. Also, pay attention to the order in which you want to mix your financing. “Always start with your own money. Your own money is the basis for your financing. Financiers often require that. Furthermore, a bank will be more likely to give you a loan if you also put in a loan from family and friends alongside your own money. Because that means that others also believe in your business,” explains Hazelaar.

Video: Financing your business

What steps should you take to get financing for your business? And which parties can you turn to? This video explains it all.

Bank financing

The main forms of bank financing for starters are:

• Bank loan
• Mortgage loan (in Dutch) 

Alternative financing

The main forms of alternative financing for starters are:

• Crowdfunding – You raise money for your plans with a campaign on an online platform.
• Business angels – Also known as informal investors. These are entrepreneurs who invest in other businesses.
• Family and friends – People you know put money into your business with a private loan.
• Leasing – You pay for the use of assets. The leasing company provides maintenance.
• Microcredit – This is a loan from Qredits of up to €50,000 for startups and existing entrepreneurs.
• SME credit – This is a loan from Qredits between €50,000 and €250,000.
• Strategic partner– A collaborative partner brings money and knowledge into your business.

Government schemes and subsidies

• Regional Development Agencies (Regionale Ontwikkelingsmaatschappijen, ROMs). These investment organisations stimulate the economy in specific regions and provinces. They mainly invest in innovative and fast-growing regional companies. The possibilities and conditions differ per ROM.
• The Startup Box contains government funding schemes aimed at innovation.
• Explore the subsidies content on Business.gov.nl to find guarantees, financial contributions, contests, and tax measures. 

Tips for using external financing

• Take interest and repayments into account when arranging any financing form. Do you have enough money to pay the interest and repayments each month, even if you are not yet making a profit?
• Ask an independent adviser for help with your financing plans. They can advise you on things like a funding application and your budget.