Despite allowing for so much personal freedom, the path of an entrepreneur is riddled with many obstacles and unslept nights. You might have a fantastic idea for a product, but without the proper funding, it’s nothing but a distant dream. Too many aspiring entrepreneurs tend to give up at this point, which is a real shame – it’s way too early for that! But since you’re different than that, here are 9 ways to acquire funding for your startup that are quite realistically achievable:
Using your own savings to fund your business straight out of your pocket may not be the fanciest way to do it, but it sure gets the job done. In case you don’t have anything saved up on the side, you always have the option of utilizing your assets (you could take a mortgage on your home just to name one example). Of course, bootstrapping does have an obvious downside to it… if your business idea fails to flourish, you’re going to have some debt on your shoulders.
If your product appeals to the masses and is quite presentable in general, you could give crowdfunding platforms a shot. In order to get noticed, however, you’re going to have to come up with a way to create a truly breathtaking product presentation. Having some kind of social media presence prior to undertaking such a task will undoubtedly make things much easier for you. But no matter what the case may be, crowdfunding is how many startups have found their success, and if your product measures up, there’s no reason why you couldn’t become one of them yourself.
You might not fancy the idea of asking your friends for help, but the fact of the matter is that they tend to require much less convincing before they hand you their money, at least compared to other potential business partners. Even though you might not be able to get much that way (after all, not everyone is in a financial position that allows for such investments), every little bit helps. However, even though they’re your friends, don’t make the mistake of thinking they’re just going to take your word for it and trust you blindly. Although they might, it’s way better to show them your business plan beforehand.
4. Venture capitalists
These are business investors who are willing to fund your company in exchange for an equity share. While it’s realistically possible to fund your business that way, the tradeoff is that you’re basically giving away a portion of your business in exchange. On the flipside, your investors are very much motivated to see you succeed, since their money’s on the line. This means you can expect plenty of help from them. In any case, you need to get one of them interested first.
5. Traditional bank loans
Sometimes, presenting a good plan is all you need before mustering the courage to visit the local bank. Dress well and give your best presentation – if you do this right, getting approved for a loan is a realistic possibility. Be as detailed as possible; explain exactly how much money you need and what purposes it’s going to be used for. In the worst case scenario, you’ll get a ‘no’, but even if that happens, you can still get a personal line of credit from the very same bank. Yes, the very same one can be used to fund your business, so don’t let the name confuse you.
6. Small business loans
Traditional bank loans might not be for everyone, but luckily, there’s an alternative. Small business loans are a great way to secure the funds you need for your business if banks prove to be uncooperative. Historically speaking, they tend to be very careful in terms of who they’re willing to approve, so you should never take their decision personally. The private lenders, on the other hand, might not necessarily have your best interests in mind, so make sure to do your due diligence to make sure that you’re working with a trustworthy lender.
Producing something truly unique and revolutionary could be your entry ticket to well-known contests like Shark Tank. But even if your product is not at that level, there’s still plenty of options to consider. In fact, there are many smaller-scale alternatives and local contests that could be just the thing you need. These are often way less competitive, since they’re limited to a particular area. Even if you don’t see any success with them, you stand to lose nothing but a little bit of your time.
8. Angel investors
Angel investors are often willing to invest in high-risk ideas and startups in early stages of development. If you’re worried about not being able to find one, don’t be; there are plenty of websites that serve as the middle point between startups and angel investors, allowing for suitable partnerships to be established. Still, you should not be too eager to jump aboard every single opportunity that springs up; after all, the angel investor will be your business partner until the very end. Make the wrong decision, and going your separate ways might not be as easy as one would imagine.
Do you like working with mentors who will help you bring your business idea to the final stages of development in a limited timeframe? Then accelerators and entrepreneurial incubators might be a good fit for you. However, please keep in mind they’re very selective in terms of who they’re willing to take on. But if you do manage to get in, they could be of tremendous value to your startup. The mentors that are going to be working with you have a lot of experience, which is a well of knowledge you are encouraged to tap into.
These 9 ways of acquiring the needed funds for your startup should get you inspired to try your hand at being an entrepreneur. The path before you will surely not be easy, but if you’re disciplined, level-headed, and don’t give up at the first sign of trouble, your future might be brighter than expected. In the end, business is all about overcoming obstacles, and only the ones who aren’t afraid of failing can succeed. Do you have what it takes to make your dreams a reality?