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Small business owners have a lot to worry about these days. With all of the brouhaha over health care reform in the United States, it’s easy to believe that any plan will somehow negatively impact business, costing more money to employers by requiring them to provide health care at a certain level to their employees. However, I don’t think the situation is as dire as many would make it out to be.

Let’s ignore for a second that many businesses of all sizes are complaining that they might have to provide their employees with health care benefits that actually meet the needs of a person living in this country and focus instead on how health care reform can benefit business. I’m referring here to the Small Business CHOICE Act (H.R.  859 http://www.govtrack.us/congress/bill.xpd?bill=h111-859) .

This is an important piece of legislation for small businesses since it provides for two major benefits. The first is that a 65% tax credit would be given to businesses who take advantage of the opportunities this bill would afford, making providing quality health insurance much more affordable and reasonable. The second is much more radical, however.

Several small businesses would be able to pool their resources into voluntary health cooperatives, giving themselves a larger pool of potential employees and, by extension, more negotiating power with insurance companies. This allows smaller businesses to compete with larger companies in terms of benefits and encourages insurance companies to take another look at smaller firms that they would otherwise dismiss as being not worth the effort.

It’s fairly clear from my previous blog posts that I support companies working together to improve how they deal with customers and employees. In this case, businesses are being paid to do exactly that.  Small firms could save over 34% per year if this bill were to go into effect, and there would be fewer uninsured Americas as a result.

It’s easy to panic when the government begins to pass laws regarding how businesses should be run, and it’s not their place to do so in most situations. However, it’s important to look at every piece of legislation individually and examine it for its merits. In this case, the Small Business CHOICE Act is a benefit to companies, encourages competition, and will ultimately save you money. It’s solid legislation and not worth the alarm.

Getting money … slogging through the venture capital minefield … can be long, time consuming and very wearing on everyone in the business. Even the guy who cleans the toilets can feel the stress that filters down through a business that’s been chasing the dream of obtaining venture capital.

So once you’ve got the money what do you do? Do you give everyone a bonus, do you throw a party? No, it’s business as usual and you go on chasing the other dream you had even before you thought of venture capital. You chase the dream of building your business, developing your product and turning a small business into a very large and very profitable one … the money may make turning that dream into a reality just a little easier but you’re still going to have to work hard.

At the same time you’re pursuing your dream you need to grasp some reality too and the best way to do that is to bring out your business plan … the one that got you the funding … and go over it again just to refresh your memory and remind yourself of where you’re heading.

It’s also time to get your management team together and sit down with angel investor or venture capitalist who is going to be part of your business from now on. Yes, if you haven’t tried to raise funds yet, I have to tell you that once your raise some angel money or venture capital there will be a new face on your board or in amongst your management team. No angel investor or venture capitalist is going to lend you money unless you’re prepared to have them represented on your team and they are going to want to have plenty of input from now on.

So you get your team together and you sit down with the new member and look seriously at where you’re hoping to take the business. It’s a good time to do it, as soon as documents have been signed, because you no longer have total control of the business. The investor is now there sharing the management of the business and his exit strategy will play a big part in the planning for the future of the business.

That may sound a little strange … after all investor has only just agreed to put some money into the business … but even before the money is paid into your business bank account they have an exit strategy mapped out. Your business plan … and the focus of the management team … may have to change slightly to fit in with that exit strategy so it’s better that everyone finds out sooner rather than later if any changes do have to be made.

Once you have the money the hard work doesn’t stop … in fact, if anything, it all just got a little harder but with the help of your business advisor and that angel investor or venture capitalist who now wants a say in the running of your business you will make it through.

One of the biggest problems facing a business when it’s first starting out is where to get sufficient funding to carry it through till it reaches the point where it’s actually generating some income.

In most cases the business owner commits his or her life to the business, friends, relatives and immediate family lend money and the business is off to a shaky start … hopefully with enough cash to last them for the first year. But where do those business owners go from there and are there other places that businesses can obtain funding other than those sources that I mentioned a moment ago?

Angel investors
Very few investors outside of your own circle of friends and family will invest in a new business before it’s even opened its doors. However angel investors are people who are prepared to lend money to take a business from the self-funded start-up situation up to the point where the venture capitalists become interested.

You can expect to pay high interest rates for money that comes from an angel investor and you can also expect a high rejection rate. The average Angel investor only considers three out of every 10 business propositions that are pitched to them and if they do invest then the amount will be relatively small.

Bank loans
This one is really a no-brainer … you know where you can apply for a bank loan and you know your chance of getting a bank loan in the current financial situation. You also know that the interest rates are going to be high so you’ll have to be able to generate income to cover the repayments each month.

Credit cards
I’ve included this one not because it’s something I would suggest but because many small business people try to get their business off the ground by relying on their credit cards. I know some people who have survived that way but you run some serious risks if this is the way you want to finance your business because those monthly payments can kill your business stone dead in no time at all.

Government grants
Yep, I’m sure you’ve seen this one too … I regularly get large chunks of spam email offering me government grants and I’m sure you do too. Now of course those emails offering government grants are bogus but there are grants made available for some businesses that are starting up.

To find out if your business is eligible for a government grant forget those emails … just contact the relevant department at the state level and they’ll be able to give you the true facts.

If you can’t start and keep your business running until it begins to make a profit from your own resources then there are options for you just as I’ve mentioned here. However, when you head for those options you have to realize that they come at a cost and it may be a cost that your fledgling business can’t bear in the long term so be prudent when it comes to making a choice about funding.