Funding a start-up company, whether online or otherwise, is hard work and most of the time the money comes from your own pockets. There are many ways to fund your business idea or give that much-needed boost to an established online business and here are some ways that may help ease the financial burden that comes with being an entrepreneur.
Ask support from friends and family
These are your immediate support system, and you may already have surrounded yourself with like-minded friends who may be pursuing a similar path. This might mean they know the importance of support from friends and in return, you can support their own endeavors, no matter what they may be.
Creating these long-lasting friendships can pay off in the long run as you will have a strong support system when the going gets tough,
Consider undertaking a crowdfund
Combining the idea of crowdsourcing and microfinancing, crowdfunding involves individuals giving you and your business or project money to show support. They may be interested in the finished product, carry the same ideals that your business or idea support or simply interested to see where the idea leads to.
Over 600 crowdfunding platforms have emerged around the world in recent years, and with the rise of social media, these two platforms combined create the perfect team to spread news of new innovations, business ideas and products to the masses.
This may be a great way for those who are only starting out to raise money to begin their journey and has been particularly useful to the likes of non-profits and individual artists.
Although crowdfunding is still in its early stages, it is becoming more and more efficient in kickstarting a business start-up. As well as this, through the process of crowdfunding, you will have already built a following and a customer base due to their support once you have completed the initial stages.
These investments are usually rewards-based with each tier offering various rewards increasing in value as the individual patron pays more and more.
One such crowdfunding platform includes Kickstarter where you can set a goal on how much money you aim to reach and for how long and now has over a thousand projects in its repertoire ranging from music albums to feature film production.
Attract an angel investor
If you’re lucky or clever about how you may promote your online business, you may attract an angel investor. These are typically affluent and wealthy individuals with money to spare to invest in businesses.
You can actively search for such individuals or their investment groups by a quick search or by contacting your chamber of commerce.
Pitching to an angel investor is similar to pitching business proposals. Show that you know your business inside and out, outline marketing campaigns you wish to undertake, any sales plan you may have, data analysis you have undertaken in preparation, objectives, and goals and most importantly, how can the angel investor benefit from investing in your business?
Show experience in the business as this can reduce fears of investment risks if they invest in your business and show your passion and not that you are merely following a trend.
Opt for installment loans
In this case, this is you investing in your own business. Make sure that when you take out loans, that you use a reliable company.
Worried about bad credit? Rightly so as this is one of the factors that banks and other loan sources take into account to make a decision. However, there are some companies who may allow loans despite a bad credit history.
You can instead opt for online installment loans as long as you demonstrate the ability to repay and have a U.S bank account. You can learn more about this option by a quick search, and you will usually be required to fill out an online request form which can take a few minutes.
Consider a bank loan or venture capital
This is more relevant to the later stages of a growing business where you may need a bank loan for various reasons such as long-term growth.
This process usually includes a request of several years of financial data from financial institutions on both the business and the business owner. In order to secure and guarantee a loan, they may need a collateral.
It may be best to engage with the bank in the early stages of your business, perhaps not for a loan, but to start the relationship which can benefit you and your business in the long run. With more familiarity with you and your business, the financial institution, you may be in a better position to request additional services as the organization itself have seen your business and its growth over time.
Venture capital funds are usually required for fast-growing companies seeking hyper growth and can be used to expand sales or introduce new products. As long as you show viability and growth, as well as show a financial return for these investors, you are on your way.
Try business start-up schemes
These are usually in the form of competitions or proposal submissions where investors decide to fund a start-up company with an innovative product or cutting-edge idea. You can find these with a quick search, and most can be entered online.
Make sure you have drawn up a detailed business plan including sales targets, marketing plans, goals and objectives and your target audience.
Likewise, you may find out about these opportunities or similar schemes by attending business conferences in relation to your industry as well as networking events. Not only will you be kept up to date with new developments in your industry by attending such events, but you can also hear insights from industry leaders as well as network with other like-minded individuals.
These are only a few ways you can fund or find funding for your new business idea or to further improve your online business and cement yourself and the business as a staple in the industry. Find what works best for your business and start planning.