How to Fund Your Green Business


Focusing your business on sustainability is as good for the bottom line as it is for the environment. Green businesses are able to cut costs by using resources as efficiently as possible. At the same time, they’re able to attract enthusiastic consumers by offering unique products and services that customers feel good about supporting, alongside an inspiring mission statement. Any business, even one that is not currently “green,” can adopt this strategy as long as it has access to green business funding. Here are some examples of how you can go green:

  • An existing lawn care business begins offering environmentally friendly lawn treatments to differentiate itself from the local competition.
  • A long-running factory decides to replace old equipment with high-efficiency upgrades to save on monthly operating costs.
  • A retail store works to minimize its carbon footprint and highlights those efforts in marketing materials to attract eco-conscious consumers.

There are countless ways to make environmental awareness a part of your business model. Unfortunately, there are a lot fewer ways to fund that evolution. Consider these options for green business funding as you plan out the next phase of your venture.

Seek Out Investors

Some investors are especially eager to work with green businesses, so teaming up can be a win-win. If you’re willing to give up equity in your business or find another creative way to make partnering with your company attractive, one or more investors may be willing to fund your entire green transformation. The drawbacks are that investors can be hard to find and closing deals rarely happens quickly. Given the amount of time it takes for funds to actually become available, green initiatives might have to be put on hold indefinitely while you settle the business side of the deal.

Invest in Yourself

If you have some money in savings there are ways to make green upgrades without having to invest a lot. Installing high-efficiency lightbulbs, programmable thermostats, or office-wide recycling bins are all inexpensive steps that make your business greener. Look at your business offerings and consider where you can cut back or invest in more sustainable strategies. Share these efforts in your marketing materials to generate some goodwill. If you want or need to invest more than you have available in savings, external green business funding is still available.

Pursue Equipment Financing

Going green doesn’t mean the business has to totally transform. In many cases, it’s possible to do the exact same things but significantly more sustainably just by upgrading the equipment. Once you’re approved for equipment financing you can buy or lease the replacements you need without having to deplete your savings account. You can also supplement your current equipment with green additions if that serves your purposes. The point is that when you have the right financing, expensive but important equipment doesn’t have to be unobtainable.

Take Out a Small Business Loan

The larger the green initiative the bigger the impact on revenues and the environment. In order to fund new product lines, additional locations, in-depth research and development or large scale re-branding efforts, lots of companies need a quick infusion of capital. In these cases, small business loans are the best source for green business funding because they invest a lot without asking a lot in return. Loans from alternative lenders are also available relatively quickly and easily processed, so companies can move forward with their green upgrades sooner rather than later.

Launch a Crowdfunding Campaign

Crowdfunding has become a popular way for businesses to fund their ambitious plans by relying on loyal supporters. If you have an idea for an innovative green product or have a strong customer base eager to see your business expand, crowdfunding could be a way to raise some or all of the money you need. The only risk is that, depending on the platform you use, you may only access your fundraised money if you reach the pre-appointed funding goals, and there are sometimes fees applied. As a result, this may not be a dependable source of green business funding for all or even most enterprises.

Making your business more sustainable environmentally makes it more sustainable economically as well. As energy costs rise and consumers become more environmentally aware, efficient businesses will be the most competitive. When you look at it from that perspective, going green now is a way to prepare businesses for the demands of tomorrow’s economy. That’s why every kind of business should thinking about pursuing green business funding while it’s advantageous instead of waiting until it’s obligatory.

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