Looking to gain some funding for your business? Not sure where to start? Most organisations no matter how big or small require adequate financing to start up and keep them profitable. If your business is newly established or you are at a pivotal point where funding is needed for extra growth, continue reading to find out the various ways you can ensure that cash continues to flow.
Finance is the ‘piston’ that gets your business plans firing on all cylinders. No matter how prospective your plans or proposal may be, without the necessary finance, it will just be paperwork gracing your shelf. Are you short of where or how to get finance for your business? One of these ten ways might be what you need.
Your personal savings are the most available source to raise funds, especially for a start-up business. As most businesses usually start from personal savings, sacrificing your hard-earned money shows how serious and committed you are towards the success of your proposed business idea. It can also give you the advantage of getting more capital from friends, family members or partners who will be willing to finance your project when you tell them how much you have personally committed towards your business.
Finding a partner that is committed enough is another great way to insert well-needed cash into your business. However, this may require that you have a two-way investment also; a committed partner will also want to ensure that he or she is not alone in the financing side of things. A good business plan can help overcome the challenge. Even if you may have the finance but lack the business idea, a partnership will not only boost your financial worth but will create an opportunity to bring more technicalities in coming out with more robust and well-organised strategies to market your products and services.
Finding a partner to finance your business idea will also lead to mutual profits shared when you finally get your business running. One example of a notable company which started from scratch through partnership is the American Automotive and Energy Company, Tesla Inc. The company was founded through the partnership of Martin Eberhard and Marc Tarpenning in 2003, and today is one of the world’s biggest producers of electric cars and solar energy provider.
Seek Financial Assistance from Friends and Family
The next best place to look when on the search for financial assistance is from family members and close friends. It is referred to as a domestic financial institute. This is where emotional affiliation comes to play; these are the people you can quickly sell your ideas to without any formal proposal or official notice. Approach friends and family members who have faith in you and are eager to see you become successful. Make a list of people, who you are sure will support your ideas and will understand your business plans. Make copies of your business plans if you want them to see your professionalism. If the financing will require an agreement on loan, make a payment plan after terms are agreed and get a lawyer to legalize it if necessary.
An Angel Investor is a person or group of people with huge amounts of capital that are willing to invest in prospective or profitable business ideas. Before approaching an angel investor, you must have a business proposal planned out. Most Angel Investors have resource personnel teams that inspect applications from applicants, to see how prospective they are.
Apply for a Business Loan or Grant
A loan is a borrowed sum of money that is expected to be paid back. Grants do not require you to pay interest, unlike a loan where interests are paid within an agreed period, pending when the entire sum of the loan is paid back. As part of the measures to grow a nation’s economy, most governments are interested in assisting business (especially small and medium businesses-SMEs) with financial loans or grant. SMEs are the businesses that keep most of the big companies active by the provision of raw materials or semi-processed goods, employment of labour and other related services. It doesn’t cost a dime to apply for a grant or loan, why don’t you give it a try? All you need to do is, follow the due procedure required to apply for one.
Enter an Entrepreneurial Competition with Your Business Plans.
There are many business competitions for small business entrepreneurs organised by local and international organisations to encourage the numbers of small and medium scale businesses. Agencies that provide entrepreneurial competitions include governments, the United Nations, foundations and philanthropists. Consult search engines and other related journals to see how you can apply for an available offer.
The whole concept of crowdfunding involves getting as many people as possible to fund your business financing campaign. It is quite different from funding through closely related persons such as friends and family, or partnership. The availability of the internet has greatly enhanced crowdfunding outreach. A convincing proposal clearly stating your plans, goals, and aims will win the hearts of willing investors or donors. You can add a call-to-action button for a free will donation to support your plans on your website. Crowdfunding campaigns are also known to attract partnerships. You can never really know where your assistance can emerge from so spread your message wide and far across Facebook, Twitter, Instagram and other social media handles.
A mortgage is a type of loan to raise funds especially for those who have assets to be used as a lien (a security interest granted over an item or property to secure payment of debt or obligations). The asset is used to get the loan and may be forfeited if the borrower of the loan failed to meet the payment agreement. This method of fundraising is for business organisations such as real estate purchases that seek funds but owns landed properties at their disposal.
Venture capital is a form of finance that is offered by firms that provide funds for small businesses that are in the startup level and show the tendency of making profits. They invest in early-stage businesses and take the risk in the hope that their business plans will yield success. Venture capital funding is given in exchange for equity and a possible ownership stake. If your business plan is innovative in areas such as technology, artificial intelligence, information technology or alternative energy, a venture capital firm will find it very prospective to invest and provide supportive strategies to make your business a success. Funding is made until a company starts selling its Initial Public Offers(IPO) of shares.
The use of a credit card is a quick way of funding your business. Obtain a business credit card which you can use to support your business provided that you can keep the minimum payment. Credit cards are well known to attract service charges and interest rates, care must be taken on how you withdraw funds as you wouldn’t want to accumulated debts for a starting business.
At MindSpace Associates, we offer effective business management workshops and business mentoring services that can take your business to exceptional levels of performance. We pride ourselves in being one of the top international providers of business coaching and mentoring services for small-to-medium businesses. For further information, contact us or refer to some of our best books for starting a successful business.