Funding Your New Business Venture
Setting up a new venture can be an extremely exciting time, and what better season to launch than with the vibrant and uplifting energy of Spring. That said, whilst it can be exciting it can also be excruciatingly stressful in terms of raising the necessary funds to launch your new business.
Indeed, one of the greatest challenges facing entrepreneurs today is obtaining the start-up cash they require to launch their business and get it off the ground. There are a number of ways to keep costs down and many successful businesses start out with very little capital yet it’s important not to underestimate the amount of money required to get a business noticed in such a competitive online marketplace.
Raising money for your new venture can feel overwhelming, like a mountain that you’ll never reach the top of yet it doesn’t have to be. There are many support resources such as accounts lab that can help you manage the day to day accounts or funding lab that can help with anything from start up loans to crowdfunding.
A lot of entrepreneurs picture themselves having to go before a panel of investors and get grilled about their business, like something from Shark Tank in America or Dragon’s Den in the UK. This article looks at a number of ways to raise capital without having to go through such a daunting process.
GET A BUSINESS LOAN
The most traditional route for setting up a small business is to get a small business loan, and this is a particularly viable option if you were to look into buying a business as an alternative to starting from scratch.
Getting a business loan is one of the most easy, reliable, and certain ways of financing your business presuming you have decent credit; though banks will often look to secure this loan on an asset such as your home. The benefit, however, is that you keep complete control of your company, as you aren’t having to offer equity to external investors, who each get a say in how your company is run – and convincing one person, is a whole lot easier than going around investor meetings.
FRIENDS AND FAMILY
If you have a wealthy relative, or several friends and family who are open to backing your business for a small incentive (such as interest on the loan) then this can be a great option, as it will cost less and be easier to arrange than commercial financing; however, borrowing money from friends and family can be a very stressful experience that totally changes (and sometimes annihilates) friendships. It might be worth considering the potential strain put on your friendships should the business not turn out to be a success.
A recent trend in raising startup capital is that of crowdfunding; where you pitch your idea on an online platform such as www.crowdfunding.com and strangers can offer bits of cash to back your idea – but these ‘bits of cash’ can accumulate to several million dollars.