Entrepreneurs can often be separated into two categories: ones with some money saved up but no ideas to spend it on, and ones with tons of ideas but a lack of finances to back them. If you fall into the latter group then there’s no need to feel down, as there are plenty of different routes out there for you to go down. If you’re a budding entrepreneur but you’re struggling to get your business off the ground due to money then read on to find out the various options that are available to you.
Crowdfunding
Crowdfunding websites allow start-up businesses to get their products or services out into the public domain, so that investors can choose whether to back them or not. They can be encouraged to do this thanks to incentives such as rewards or exclusive products, and if your idea really gains traction it can take off and gain large amounts of funding in a matter of weeks. Just be sure to read the terms and conditions of any crowdfunding site you use, so you’re aware of what you’re getting into.
Venture capitalists
If your business has outgrown the start-up phase and there is a decent revenue stream coming in then you may be able to benefit from the help of a venture capitalist. These are people who will invest money in your company so that it can grow even bigger, before selling their share a few years down the line. An upside of this method is that venture capitalists are often quite knowledgeable within the industries they’re investing in, so they could be able to offer you some valuable advice.
Business credit cards
These are a common way of financing your business, providing a quick and easy route for financial help. The minimum payment for credit cards is low, so if you’re a new business with not much expense you could try to put in on the card and enjoy the lower payments. However if you struggle with the repayments then the interest rates can quickly build, causing debt to increase. Make sure you can definitely handle credit card debts if you’re going to pursue this option. There are some great options for business credit cards, so make sure you shop around.
Guarantor Loans
These guarantor loans allow you to borrow fairly large sums of money, even if you have a poor credit history. This is because they are guaranteed against friends or family members, and if you can’t make loan repayments then your guarantor will do so for you. With these loans you don’t need a credit check and the loan can be paid out within the space of 24 hours, making it a great choice if you’re looking for funding in a hurry.
Preselling your products
You could always choose to sell your products before an official launch, before using the money you raise to finance your business further. Preselling allows you to raise money for extra inventory and also get your brand out there into the open. It can be tricky to work out how many units you’re going to need at first, but you can always use it as an important learning curve for when you’re final product reaches its official launch.
As you can see you have more than a few options to choose from when you need funding to get your business going. Whether you decide on crowdfunding, venture capitalists or any of the other choices you should just be sure to do your research beforehand, giving you and your business the best chance of success in the future.
Also published on Medium.
