America is a nation of entrepreneurs. There are already over 27 million entrepreneurs in the country and about a third of the population wants to venture into entrepreneurship.
The only thing standing in their way? Startup capital.
You see, it’s one thing to have a business idea and it’s quite another to bring the idea to life. You need adequate capital to make it happen.
The good news is there are a couple of effective ways to raise business capital when you can’t self-fund your idea. Continue reading to learn how to raise small business capital – fast.
Go in for a Small Business Loan
After the great financial crisis of 2008, most commercial banks were reluctant to lend money to small businesses. The associated risk was too high. This is why most starting entrepreneurs are always reluctant to go in for business loans.
Your reluctance is well-founded, but things have since improved. More and more traditional banks are making loans to small businesses. If you already have a relationship with a local bank, don’t shy away from approaching it for a business loan.
Alternatively, there are hundreds of private companies that are offering small business loans. Just go online, do a search, and find an ideal lender.
The Small Business Administration also offers business loans to small enterprises. The qualification requirements vary depending on the specific type of loan, so be sure to do your research.
Find an External Investor
If you’re a seasoned entrepreneur, you’ve probably heard about venture capital and equity investors. These are companies or individuals looking to invest in small businesses with high growth potential.
If your small business idea is unique and has the potential to morph into a large corporation in the future, try finding an external investor to pump money into your idea. In return, you’ll give them an ownership stake in the company.
Unlike taking out a business loan, equity capital doesn’t have the repayment condition. This means you won’t worry about repaying your investors.
However, most investors will want to ensure their money is put to good use since they stand to lose their investment if the business fails. On your part, there are steps you can take to guarantee prudent use of investment funds. Read more here to gain deeper insight into some support services that will optimize your business capital.
Run a Crowdfunding Campaign
Crowdfunding is becoming an increasingly popular way to raise small business capital. By 2025, entrepreneurs will have crowdfunded a whopping $300 billion.
Platforms such as Kickstarter and Indiegogo give you the opportunity to run a crowdfunding campaign. This method is heavily reliant on your ability to promote that campaign on social media and other channels; otherwise, you might not be able to reach your fundraising goal.
You Can Raise Small Business Capital Fast
Your business idea is ready, so is your business plan. The only thing missing is adequate capital, right? Not anymore! With this guide on how to raise small business capital, you now know where to find the money.
All the best and keep reading our blog for more small business tips.