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Venture capitalists
Pros: They've got a lot of money. Like bankers, venture capitalists aren't handing out money from their own wallets, so you can seek much larger amounts that you would get from a bank loan - if you can find a VC firm that specializes in your industry.

Cons: It could be a waste of time. VCs take only a handful of promising companies and will scrutinize your venture as thoroughly as banks will.

"Time for a sanity check," Siegel says. "Not everyone is a viable VC prospect. You're looking at some very expensive capital. They deal with higher-risk ventures, and so they deserve a higher reward." Be prepared to surrender partial ownership of your company if you score a deal.

NEXT: Angels

LAST UPDATE: Sep 30 2008 | 11:23 AM ET
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