5 Ways To Fund Your Start Up
One of the biggest hurdles to starting a new business is finance. There are those who will tell you just to start your business with what you have, start small, and then use your income to grow your business, but in many cases, it is not quite that straight forward. Using your own cash is only possible if you have it and using a credit card is quite risky. Here are 5 ways to fund your startup that are worth considering.
With a solid business plan and a good credit record, one of the most common ways to start your business is with a bank loan. The banks do have strict conditions and most banks today have a range of tools to help you plan and begin your business. A bank loan does, of course, need to be paid back but it is a superb and trusted source of early capital for your business. It makes sense to have an accountant help you create your business plan.
Crowdfunding is a relatively new way to fund a small start-up business. In recent years a number of crowdfunding platforms have emerged that allow an entrepreneur to tap into their network of friends and friends of friends online. Each platform for crowdfunding is slightly different and each has certain rules either about rewarding investors or paying them back. As always, to capitalise on this source of funding a solid business idea and accompanying business plan is essential.
Very often when larger sums of money are required to start a business a business investor is a superb way to raise capital. An investor nearly always seeks to obtain equity in the business and often brings expertise or a network of contacts to the table that can add value to or be useful for the business. On top of equity, an investor may also seek a return on investment over a given period of time.
Nearly every country in the world wants to encourage new business and because of this are many grants, schemes and other incentives that can be used to fund a start-up venture. Very often the grants and schemes have fairly strict criteria, and these must be satisfied fully to secure finding. This kind of funding does not always have to be refunded provided the terms are met. With these schemes mentors and business guidance are often provided.
Small loan providers are found everywhere and short-term loans for relatively small amounts are easily sourced. Interest can be high but a micro-loan can be the quickest way to get fast finance to kickstart your business idea, particularly if the business has few start-up costs and can begin to general income quickly.
Funding a start-up is often the biggest hurdle to overcome bit once done your business can soon become a reality and your success is in your hands.