A Fresh Start: 7 Business Startup Funding Tips That Will Change Your Life
Have you had an idea for a brand new business? Have you seen a problem in the world and think you have just the solution? Well, awesome! You may well be onto something. However, you’ll soon realize that having the idea is only one part of the puzzle. Having access to startup funding might be a critical piece of the puzzle.
The next crucial step is acquiring the funding to get your business up and running. With approximately 77,000 new start-ups competing for capital investment every year, securing startup funding can be easier said than done.
The good news is that it’s entirely possible. You just need to look in the right places and approach it in the right way. Having a few tricks up your sleeve never hurts either.
Are you wondering how to get the cash together to push forward with your idea? Let us help. Keep reading for seven startup funding tips to help get your new business off the ground.
1. Put Together a Business Plan for Startup Funding
Having a business plan is usually essential to acquiring external startup funding.
After all, you’re asking people to give you their money. They’ll almost never volunteer their cash without a solid business plan that demonstrates how it’d be in their financial interest.
Take your idea and formulate it into an actionable plan of how the business will develop over time.
It should consider the current market and your target audience; your financial goals and how you’ll achieve them. It should demonstrate your USP (unique selling proposition) and how you’ll stand out from the competition.
The business plan will go with you into any forthcoming investor meetings. As much as anything else, they’ll see that you’re serious and have put thought into the development of your idea. If the financial projections look good too, then you’re onto a winner.
2. Ask Your Loved Ones
Don’t be too proud or embarrassed to ask your friends and family for financial help.
Indeed, many successful businesses begin with a loan from the Bank of Mom and Dad. It makes perfect financial sense to take this route through the absence/minimal interest involved.
Unlike banks, your close loved ones aren’t interested in turning a profit. They only want to see you succeed. They may even volunteer the money without a second thought.
Treat it seriously though and remember that there’s nothing like money matters to put a strain on a relationship. Approach loved ones with your business plan to show them how you expect to use their money (and how you’ll earn it back).
3. Use Your Personal Savings
Think about dipping into your personal savings account as well.
You might have amassed a significant sum of money over the years, which could be the lifeline your business idea needs. Many people are understandably reluctant to take from their savings. However, it does come with a host of benefits.
First and foremost, you aren’t going into any debt. That saves you the stress and hassle of handling repayments and compounding rates of interest.
Another advantage is the fact that you remain the only stakeholder. The profits remain yours and yours alone. Of course, the same is true of the financial risks involved.
4. Find a Partner
Entrepreneurs often balk at the idea of partnering.
They like being in control and want it to stay that way. The thought of disagreeing over particular decisions and courses of action can be enough to avoid it altogether.
In financial terms, it can be incredibly helpful. You have the idea but they have the money. It can be liberating to partner with a wealthy individual who gets behind your business.
Even if they aren’t hugely wealthy there are still advantages to consider. The financial burden (as well as any profits) gets shared between you. It halves the risk and doubles the work you can get done to secure funding.
5. Try Crowdfunding
Crowdfunding has revolutionized the way startups acquire investment.
Set up an online account, promote your idea, and total strangers give you money to help bring it to fruition. A huge number of businesses have been set up off the back of a successful campaign.
Of course, it’s never guaranteed but with some effective marketing and a bit of luck, you can earn enormous sums of capital in record time.
Most startups offer particular deals to incentivize investment. Somebody starting a new clothing line, for example, might offer one of the first t-shirts they print to people who invest $100. For $500 they’ll send them multiple items and a hand-written thank you note.
6. Go to Angel Investors
Angel investors are simply wealthy individuals who invest in new businesses.
Unlike other funding options, they’re typically involved in the early stages. That makes them invaluable when you’re just starting out.
If you can woo them with your idea, they may agree to invest in exchange for equity (or convertible debt).
Another perk of seeking funding from an angel investor is the counsel they can provide. Many AIs are entrepreneurs themselves, which gives them a wealth of knowledge. Their expertise can make them an active participant in the growth of your business.
7. Secure a Business Startup Funding Loan
Business loans have long been a go-to source of funding for budding entrepreneurs.
These days, though, you aren’t restricted to your local bank. There are many loan providers (both online and offline) who can help supply the money you need.
Now, the exact process of applying for funding can vary between lenders. Generally speaking, though, they’ll look at your business proposal, check your credit score, and decide whether or not to offer the money from there.
Only use reputable sources of funding in order to steer clear of loan sharks and other unscrupulous lenders.
Time to Boost Your New Business With Startup Funding
Accessing startup funding is vital for getting a business idea off the ground.
Unfortunately, with tens of thousands of others doing the same thing, finding appropriate funders can be a challenge. Hopefully, the tips and suggestions in this post will help you do it.
Want to simplify the entire process? Use our service to apply for startup funding online with ease.