Every business needs additional funding at some point or another. Here are the answers to four critical questions to help you along the path to success.

When's the best time to start looking for capital?

Now, before you get caught in a cash crunch. Finding money takes time. If you start early you can find more options. There was a company looking for an investor so his company could increase their production. As he was sitting in the meeting with the investor, and the investor's accountant, the lights went out because the electricity hadn't been paid. The business owner turned to the investor and said 'See, I told you I needed the money quickly.' That is not the way to do it.

How do I know which kind of capital is right for my company? Should I look for a bank loan, an investor, or just use my credit cards?

The answer depends on how much money you need, when you need it and how much control you're willing to give up. Consider the different variables. Put simply if you need $10,000 your credit cards might be the option. If you just need a few thousand dollars to get through the next month, you might be able to convince your vendors/suppliers to carry you for that month and offer them a bonus if they you do. However, if you need $2 million dollars you really need to consider a bank loan or venture capital.

Any scams out there?

Of course. The problem is that most people don't plan ahead. They don't project their cash flow. They think that profits equal cash. As long as they're profitable they should be fine. Right? And then it's a shock to find out that they don't have the money to cover their operating expenses. This situation leaves them vulnerable to all sorts of vultures. One type to be aware of is the 'investor' who promises to invest and then backs out – for whatever reason. However that particular investor says they know of someone who has the money and would be interested in investing in the business. And for a small fee, several thousand dollars, he/she will make the introduction. That 'investor' never intended to invest in the first place but was on a fishing trip for an introduction fee the whole time

Another scam is the guaranteed bank loan for businesses with poor credit. You pay a modest fee upfront to a loan broker who says they have connections to offshore money. The only guarantee is that you'll lose that fee.

What are some of the more unusual ways to finance a business?

Investor funded advertising. No, this isn't advertising for an investor. This works better with consumer products that require substantial advertising, such as infomercials. You have the investor pay for the advertising and in return they receive a share of the revenues generated from the advertising. The orders have to be independently verified. Often the investor will demand that all the money generated from the orders be placed in a separate bank account, the investor's share is deducted first and the remainder sent to you. The share to the investor can be substantial from 20 to 50% of the sales generated.