Business First Family Business, Accounting, Finance, Investing, Marketing And Management
One of the most important things to jumpstart your business venture is to have enough capital to do so. Getting and finding funding for a new business venture can be very challenging even in a growing economy. Whether it’s an app or online business, you are going to definitely need some money to start out buying your raw materials. Here is a guide on ways on how to fund your business venture.
Angel Investors
In order to finance your business venture, consider angel investors to fund your startup growth. Right now, there are many investors out there who have the cash to spare and are looking for a good business idea to invest in. These people are what we call angel investors. They are usually high net-worth individuals whose hobby is to support start-ups.
With this kind of situation, you need to come up with a killer pitch, which is what is usually called the elevator pitch. You need to catch the attention of these angel investors and make them believe in your idea. What is great about angel investors is that alongside the financial support, they also offer their expertise and mentorship. With angel investors, the catch is that they usually ask to own a portion of the company for the corresponding investment.
Friends and Family
The least costly way to get funding is to achieve it without having to pay interest or to pay lower interest. To do this, you can borrow money from friends and family first. It can be a bit difficult to ask your friends and family, but the trick is to treat them like business investors. Pitch and sell your business venture to them. Have your business plan ready and let them know all the potential risks that you will be taking in this new business venture. If they believe in your business, it will be easy for them to invest in your business as long as they have additional cash to spare.
Even their investments that you can liquidate can pose as start-up capital. Gold, for instance, is something you can sell to get cash for your business venture. Gold buying in 2020 has proven to increase due to appreciation in value, so you will easily be able to liquidate gold if you are given gold as capital. Then, you can start talking out the terms of your exchange after that. Some might be comfortable with lending you at zero interest, and others might ask for low-interest fees from you.
Crowdfunding
One of the most popular ways to finance your business venture is to start a successful crowdfunding finance project. With the digital advancements these days, seeking funding for your business venture has also evolved. For instance, crowdfunding might be one of the results of this. In crowdfunding, there are usually website platforms online that let you do this. You just need to launch your campaign, put in your pitch, and specify how much capital you need. Then, the platform will invite its users or members to invest in it. Your funding will come from different people until it reaches the target amount that you listed.
For instance, Kickstarter is an online platform that allows you to post your projects and business ideas. This platform already has a huge following and a good reputation. On this platform, you just set your funding goal and wait to get backers. Once you hit your target, you can start collecting your funds. In return, you just need to share your goods with the people who helped fund your project or business idea.
Bank Loan
A traditional small business loan is one of the most popular ways to finance a new business venture. All of the ways above might take time and are very uncertain. If you want to be certain and get your money immediately, then you might just need a bank loan. However, with a bank loan, you need to pay higher interest fees to the bank. In addition to that, you also need to undergo a rigorous application process with all your documents. To secure your loan, banks might ask for assets to serve as collateral. You need to be prepared with assets that you can put up as collateral as well. Banks usually require a good credit history and track record with a bank. If you want to take this road, you have to make sure that you have a good credit score and you can actually check your credit score online.
Even though it can be challenging to get funding for your business, there are many ways to achieve it. You just need to keep trying each and every way to get funding for your new business venture. Once you have funding, you can start launching your business at once.
