It shouldn’t come as a surprise that funding (or the lack of it) is one of the main reasons why most businesses fail. It is actually a bit difficult to imagine creating a successful business without sorting out your funding source. Unfortunately, the problem of funding runs through almost every stage of a business’ life. And because money doesn’t grow on trees, business owners and entrepreneurs need to find creative ways to finance their business projects. So, are you in the process of taking your business idea off the ground? Are you running low on capital? Here are a few ways to raise funds for your business.
Thank God for the internet, right? Businesses have taken advantage of the internet to market their brands and generate sales for decades. But in recent years, individuals and entrepreneurs have turned to the internet as a source of financial support also. If you use the internet regularly, you may have heard of platforms like GoFundMe, Crowdrise, Kickstarter, and many more. You can also take advantage of platforms dedicated to event creation and reservation to raise funds. Even if you have any technical experience, you can find out what’s the best event reservation platform and start from there.
Borrowing from friends and family
Some entrepreneurs don’t like the idea of borrowing, even if it is from friends, family, and loved ones. But if you believe in your business project and the potential it offers, you should be ready to take advantage of any social source of capital you have around you. Plus, it is safe to say that borrowing from friends and family is more convenient than resorting to banks and financial institutions. For one thing, you will have more flexible repayment options.
Before you resort to your friends and family, you might want to consider scrapping together any personal source of funding you have. From your savings to monthly incomes, using the money you have instead of borrowing is the best way to stay away from financial entanglements. You will have much more freedom to run your business the way you see fit, instead of bending to terms and conditions from lenders and investors.
Suppose you have a bright business idea or product, but you need the proper financial support to take it to the next level. In that case, you should try targeting angel investors. Bootstrapping and relying on friends and family are great options to have – if you have those options. If you don’t (and still want to stay away from the banks), you should look for angel investors. These are investors always on the lookout for the next best thing to invest in. Many successful businesses you’ll find today, including Yahoo and Google, relied on angel investors. You just need to know where to find them and how to convince them.
However, you need to note that seeking financial support from angel investors usually requires sharing equity in your business with your investor.