Who doesn’t get excited at the idea of starting a new business? Until the “with what money” question hits them. Don’t lose your enthusiasm. Getting the funds to start a new business isn’t that difficult. You need to know how you’re going to use those funds for your new business and how you plan to pay back the money.
That being said, you should know that there are many ways to get your business funded. There are conventional methods that have been used for years and new, unconventional ways. All you have to do is pick the one that suits your needs. But before that, you should do some research first.
The thing is that the whole process can be ridden with obstacles so it’s good to know who funds you and how much you can control the entire process.
Doing the Necessary Research
The funds to start a new business can be found if your company produces something that is profitable at this moment. So, this is one of the options that does not involve loans from strangers and might be the least stress-generating source of funding.
You can also get funds to start a new business if you come with an innovative product that is also future proof. This is the situation that can offer you an advantage. If the product is good enough, you will have the customers “craving” for it, even in the future.
You can search the Internet and find all kinds of people or organisations that are willing to fund your ideas and do business with you. The way you present your idea can also decide if an organisation is going to offer its money to you or not. Also, keep an eye out for the requirements they ask for.
The Conventional Way
The classic way to get funds to start a new business is by going to a bank and requesting a bank loan. It is a financing method through which you borrow funds that you will have to pay back with interest in a certain amount of time. This method can work if you know you will get your business running and producing money immediately.
Besides, there are plenty of banks that support small businesses in particular, and they are a good place to start applying for a loan. However, keep in mind that in most of the cases, the bank might ask you to have a minimum capital you are going to invest in this business.
Another method of getting your business funded is by equity finance. You can invest a stakeholder’s funds into your business, but a part of the business will be owned by the one who helped with your funds. It can be risky, but if your help is someone you can trust, then you have nothing to worry about.
There are also organisations or governmental organisations that can help you. It depends on the amount of money you require, the type of business, its current stage of development and other factors.
We recommend you seek professional advice before choosing any funding method. ALC Commercial can help you out with advice and even offer you a quick business loan if you want to settle a deal.
The Unconventional Way
We don’t call it unconventional because it is unusual, but because it is new and may not be the thing you expect. We are talking about online crowdfunding. There are tons of crowdfunding platforms like Kickstarter and Indiegogo that can help you in different ways and might be more useful than you think.
If your product attracts a lot of visitors on your site and you need money to fund that project or your company, then you can set a crowdfunding page. You might get the money in less than a day or even a month, depending on how much you ask for. Also, the way you present your project is very important and might influence your success with crowdfunding.
As for the payback, you can deliver the finished product or give non-monetary rewards. Just remember that online crowdfunding is a different beast than all the other conventional methods, so do your homework first. It is always important to know what you get involved in since everything has both advantages and disadvantages.
Ready, set, go!
No one ever said that building a business from the ground up is easy. But you shouldn’t be discouraged by that and give up your plans. It takes quite some work, but it will definitely pay off once the profits show up.
Many people consider that finding the necessary funds is the most difficult part, but as you can see, with a bit of research, things start to look a little brighter. Now that you know how to get the funds to start a new business, you should analyse all methods and see which one works for you.