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Small Business Funding Options for eCommerce Businesses

April 17, 2023

ECommerce businesses are on the rise, allowing entrepreneurs to make their products and services available to people worldwide. While this offers great potential for success, it also requires significant funding to get started. In this article, we will explore all of your available options for finding financing for your eCommerce business, from bootstrapping to venture capitalists and everything in between. We'll also discuss the pros and cons of each option so that you can make an informed decision about how to fund your business.

ECommerce Business Funding Options


Bootstrapping is the process of funding a business with your own capital, which could mean using money from savings or personal credit cards. It's an attractive eCommerce business funding option for those who don't want to take on additional debt or give away equity in their business. One of the most significant advantages of bootstrapping is that you maintain complete control of your business and don't have to answer to anyone but yourself.

Despite the potential benefits, bootstrapping has some significant risks and drawbacks. You must have a large sum of money to use as your starting capital to succeed. Furthermore, using your own personal funds or resources for this venture creates an inherent risk that could result in catastrophic loss. Finally, achieving larger-scale growth objectives over time can prove challenging without access to outside funding sources such as investors or government grants.


Friends and Family

If you are considering asking friends or family for money, there are a few guidelines that you should keep in mind. First, be very clear about the terms of the loan or investment and be honest about what kind of return they can expect. Also, ensure you have a repayment plan and tell them exactly when they can expect to get their money back. Doing so will go a long way toward keeping your relationships intact and not putting undue stress on them.

One of the best perks of borrowing eCommerce business funding from friends or family is that they may be willing to offer more flexible terms than a traditional lender. It may also be easier to acquire the funds from a friend or family member since they already know and trust you.

The most considerable disadvantage of borrowing from friends or family is that it can strain relationships, especially if the loan isn't repaid promptly. Your friends and family may not have access to as much cash, so you may need to find other funding sources if you need a larger loan. Not to mention, asking friends or family for money can be uncomfortable, and there is always the risk that they may say no.


Term Loans

Term loans are one of the most popular and traditional business funding methods. Generally, these types of loans require collateral such as real estate or equipment to secure the loan. In addition, there is usually an application process and an interest rate associated with the loan.

The Small Business Administration (SBA) offers several types of loans for small businesses, including SBA 7(a) Loans, Microloans, and Disaster Loans. The SBA 7(a) Loan is a general-purpose business loan that one can use to cover startup costs or expand existing operations. Microloans are smaller amounts of money with shorter repayment terms for businesses needing working capital or inventory. Finally, Disaster Loans provide financial assistance to companies affected by declared disasters. There are also term loans offered by banks directly, such as Bank of America and Wells Fargo.

Term loans offer an attractive eCommerce business funding option for those who don't want to give away equity in their business but require more money than they can access through bootstrapping or friends and family. The loan terms are usually fixed, so you know exactly how much you must pay back each month. Additionally, banks typically offer lower interest rates than other forms of financing, such as venture capital or angel investments.

One of the downsides of term loans is that they often require collateral to secure the loan, meaning that your assets may be at risk if you cannot repay the loan. Furthermore, it can take a long time for a bank to approve a loan application, and there is always the risk of declining your application. If the loan does get approved, the strict repayment terms may not work with your budget or goals.



Crowdfunding is an increasingly popular way for entrepreneurs to secure capital for their businesses without giving away equity or taking on debt from traditional lenders or venture capitalists. By leveraging the power of social media and the internet, crowdfunding allows entrepreneurs to leverage small donations from many people to fund their businesses.

The most beneficial aspect of crowdfunding is that it can be used to test the market for a product or service before investing significant resources into it. With crowdfunding, there are typically no upfront costs or debt involved with launching a crowdfunding campaign, so there is no risk if you don't achieve your goal. Moreover, successful campaigns can generate financial capital, valuable brand exposure, and customer feedback, which could prove invaluable when launching a business.

However, there are some potential drawbacks to using crowdfunding as an eCommerce business funding option as well. For instance, reaching your fundraising goal often requires extensive marketing efforts, which can become costly and time-consuming. Your supporters may also expect certain rewards in return for their donations, which could put additional strain on your resources.

Finding the right crowdfunding platform is essential for ensuring a successful campaign. Popular platforms like Kickstarter and Indiegogo are great starting points for reaching a broad audience. In contrast, smaller niche sites like Patreon can better suit certain businesses or projects. Whichever platforms you choose, read all the guidelines carefully before setting up your campaign.



Grants are another way to fund your eCommerce business without giving away equity or taking on debt. Grants are typically awarded on a competitive basis and can come from private, government, or non-profit organizations.

One of the major advantages of grants is that they do not need to be repaid and often come with additional resources for specific projects such as research or training. Additionally, grants can allow access to markets that may otherwise be inaccessible due to a lack of capital. They often come with mentorship opportunities that can be incredibly useful when launching a business.

On the other hand, applying for grants has some disadvantages as well. The application process is often lengthy and complex, requiring you to submit detailed proposals demonstrating how your project will meet specific criteria the grantor sets. Also, most grants are highly competitive, so there is no guarantee that your proposal will be accepted.

If you're interested in applying for a grant, it's essential to research the right opportunities for your business. Start by looking at local and federal government programs and private foundations or non-profits that may offer small business grants. You can also use online resources such as GrantWatch or Grantspace to search for relevant funding opportunities. Finally, don't forget to look for industry-specific grants, often tailored toward specific types of businesses or projects.


Business Credit Cards

Business credit cards are available to startup eCommerce businesses and established ones and are a great way to access funding with minimal upfront costs. You can use a business credit card for inventory purchases, supplies, shipping, marketing, and other operational costs. Moreover, most business credit cards come with rewards programs that enable you to earn cash back or travel points which can help offset the cost of running your eCommerce business or save for a vacation.

If you're looking for an easier way to access funding for your eCommerce business, Fund&Grow can help! With our experienced team of experts, we can provide up to $250,000 of zero-interest business credit through our done-for-you program. We've helped thousands of eCommerce businesses access the funding to start and scale their operations, so rest assured that you'll have the funds you need quickly. Click here to learn more about how Fund&Grow can help you get access to the funding you need to fuel your eCommerce business.

The funding options for eCommerce businesses are varied and can accommodate a variety of goals and needs. From equity crowdfunding to grants and business credit cards, there is likely a way to access the funds you need to get your online store up and running or expand your existing operations. It's essential to research, compare different options, and ensure you choose the proper funding method for your specific needs. With careful consideration and preparation, you'll be able to find the funding that is best suited for your eCommerce business.

I take tremendous pride in building positive and lasting relationships in my businesses and personal life. Every member of my team is committed to helping our clients get the maximum amount of funding possible and achieve their highest growth potential.

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