Do you have a business idea or startup company, but no way to get capital? This is for You.
Every year hundreds (if not thousands) of entrepreneurs create startup companies and businesses with big dreams of how milestones will be reached and profit margins surpassed.
The sad reality is that the probability of success is far from guaranteed. Very few new businesses reach the 5-year mark, and even less are active after 10 years. Only a very few percentage will go on to become mega companies like Apple, Netflix, Microsoft and the likes.
One huge reason for the extremely low success rate, is lack of capital. Today we will show you entrepreneurs, a few tips on how to raise such capital.
Be Your Own Investor
Yes I know this isn’t a new concept and you may have already considered it. Before you dismiss it, hear me out. Most entrepreneurs in recent times decide to fund their businesses by themselves for a significant amount of time, until more funding opportunities come into play. This can be done by using your savings and leveraging other personal assets. Investing in your own business is also advisable because it makes other investors much more comfortable knowing you have skin in the game i.e something to lose as well. It shows you will be much more motivated to reach and maybe even surpass expectations.
If this isn’t a viable option for you, don’t worry, I got you.
Taking Small business loans
Applying for loans is also another way to acquire capital for a startup or new business. All the financial institutions require from you is a good business plan, profitable projections and you are good to go.
It is however, very important to set goals and objectives that are realistic and can be delivered within the set period of time that has been agreed upon. This is because when said period of time has elapsed the bank (also known as financial institutions) will immediately want to begin getting returns on their investment.
Family and Friends
Though rather risky for personal relationships if the business fails, sourcing for capital from family and friends is a tried and tested method that is not only widely popular, but also effective and has been used since time immemorial.
Silent Partner or Investor
Silent partners or investors, generally provide more favorable terms compared to other lenders since they invest in the entepreneur or entrepreneurs starting the business, as opposed to investing in the viability of the business. This is because the main aim of this kind of investor, is to help the start up business, take their first move, instead of focusing on getting possible returns from the business.
Silent partners or investors in that way, provide a much better environment for entrepreneurs to grow their new businesses.
There you have it!
Please note that while capital is essential in starting a business, creativity, the ability to market or sell yourself/brand/business to potential financiers as well and thinking outside the box, are all as important. Maybe even more.
