Borrow money for your business with a financing mix
- KVK Editors
- Background
- Edited 23 December 2024
- 2 min
- Managing and growing
- Finance
You want to grow your business, or you are just starting out. Do you need to borrow money to do so? Then you will need to look for business financing. Increasingly, you will not be able to borrow the total amount you need from a single financier. You will need different forms of financing at the same time. This is called a financing mix or stack financing.
What is stack financing?
Stack financing is combining multiple forms of financing so that you can obtain the total amount you need. Instead of one (large) loan, you use different forms of business financing alongside each other. You create a mix that suits your situation.
Why choose a financing mix?
Sometimes a financier cannot lend you the full amount you need. With stack financing, you can still get the amount you need. With stack financing, you combine forms of financing that complement each other in terms of spending purpose, term, risk, speed, and flexibility.
Examples of stack financing
Are you going to use forms of financing? Then create a combination that suits your business phase. Commonly used combinations of financing forms are:
When starting your business
- your own money
- microcredit
- private loan from family or friends
You pay part of your plan with your own money, a financier lends you an amount, and you borrow the rest from your immediate environment. This allows you to buy the things you need to start your business and pay the initial costs.
When your business grows
You take out a business mortgage for your larger business premises, lease the machinery or vehicles, and use an overdraft facility to pre-finance the VAT.
When taking over a business
- business loan
- contribution of own funds
- subordinated loan from the seller
A financier lends you an amount for the acquisition of machinery and stock. You finance the goodwill with your own funds and a loan from the seller of the business.
Use the Financing Finder
Would you like to know which types of financing best suit your business plans? Then use the Financing Finder tool. Answer the questions and see the results.
Advantages of a financing mix
There are advantages to stacking financing:
- You have a better chance of successful financing.
- You are not dependent on a single party.
- You can combine the terms and conditions flexibly.
- You can often obtain a higher amount of financing.
- Your risks are better spread.
Points to consider with stack financing
Stacking financing can be complicated. You will be using forms of financing from different providers. This means that you will need to maintain contact with multiple parties and be clear about who you have made which agreements with.
 Keep in mind that the terms and conditions and duration may vary depending on the type of financing. It is also not always possible to receive the money from the various financiers at the same time. That is why you need knowledge of the various types of financing and how to go through the different procedures.
Help with business financing
The Financing Guide shows you the way in the world of financing. Do you still have questions after reading the information? Call the helpline on 088 585 11 11. Or opt for guidance and support from a Certified SME Financing Advisor (in in your area.
