Starting a business is tough. You might have great management skills, leadership qualities, networking skills, and all the other qualities needed to run a successful business.
But you still can’t be successful if you don’t have the capital you need for it. Most businesses fail due to a lack of funding.
Raising funds for your startup isn’t easy. But this doesn’t mean you’ll give up. Instead of doing that, you can try out the following ways to get the funding you need for your business.
1. Keep Your Day Job
One big mistake that most startup owners make is to quit their day job as soon as they start working on their venture. But you fail to realize that it’s your job that’s helping you meet your expenses and letting you live a comfortable life.
So don’t rush to quit it to pursue your dreams. By keeping your job, you can continue working on your business without much financial pressure. It’s a secure way to lift your business off the ground and build it through the difficult phase every business goes through in the early stages.
2. Bootstrapping
Bootstrapping is when you build your business with no funding but your personal savings. No investor will fund your business unless they see some establishments.
You don’t have to do a lot at this stage. But every investor would want to see a certain amount of work that’s put into the business.
For that you need money. That’s when bootstrapping comes into play, where you tap your self-funding options. But before doing that, know what your requirements are and how much you can fund your business.
You can try using your personal savings, no interest credit cards, etc., and see how much can be managed. But make sure that you don’t go beyond what you can offer. There’s no point in breaking the bank if your savings isn’t something that meets your requirement.
3. Get Crowdfunded
Although raising money isn’t that easy, the internet has made it possible to reach out to potential investors who are willing to fund your business
Crowdfunding is the practice of raising funds for a small project or business from a huge number of people, including friends, family, individual investors, etc. You can reach out to these people through the internet, typically through social media or crowdfunding platforms.
Most startups use this method to raise funds for their business. It works best if your business is related to a social cause. There are several crowdfunding platforms like GoFundMe that can help you meet a potential investor.
But one important factor to remember before trying this option is that these investors(unless it’s a friend or family) have no personal rapport with you. They agree to invest in your business solely based on the product or service you pitch. So there’s a high pressure on you to create a pitch that stands out.
4. Reach Out to Angel Investors
Another way to get funding for your business is through angel investments. In this type of investment, the investor funds your business in exchange for ownership equity in the company. But these investments can also be exchanged for convertible debt.
Also, it’s common for angel investors to fund your business in your early stage. That’s because they like your plan and trust your goals. That’s why you need to have a solid plan that has the power to impress them before you reach out to them.
Many angel investors are entrepreneurs themselves. Apart from the money factor, they might also be interested in how your business works, it’s management, etc.
So finding a good angel investor can be extremely beneficial for your business. Being a business person, they might have some excellent advice for you that can help in your business’s overall development and growth.
5. Find Strategic Partners
Strategic partnership or co-branding isn’t a new concept. Many businesses work together for mutual benefits in the long run. One of the major benefits of such partnerships is financial support, which can help you accelerate your growth and reach your conversion goals.
So try finding a good partner who can help you grow your business. A good thing about such a partnership is that, unlike with an investor, here you don’t have to give away more than half the total equity. So, you can still enjoy half the profit you earn from your business if you have just one partner. Of course, this profit will decrease if you have more than one partner.
Finding a business partner also offers several other benefits. If the partner already has a business, you can now access a new set of potential customers that your partner has already secured. This will also include a solid and ready-made email list, social media following, etc.
You can also have someone to offer suggestions that your business can benefit from. It’s a great way of bringing new ideas and solutions to the table.
On the flip side, such partnerships may give rise to arguments and disagreements that you should be prepared for. Also, make sure that you partner with someone you can trust. So don’t rush to conclusions when making such important decisions.
6. Join Competitions and Funding Programs
Various platforms organize different contests for startups and businesses with small and big cash prizes. Although this may not always bring you solid funding, it’s a good way of getting some extra money for your business. And if you’re lucky enough, big opportunities might come up too.
For example, we have a program called the Growth Accelerator Fund. In this program, we invest anywhere between $100k to $500k in small WordPress focused businesses. Along with the investment, we also work closely with the founders to refine and optimize their existing products. Depending on your business category, you too can find contests like this to join. Winning such contests can help you a lot in growing your business.
Although it’s not easy to get people to invest in your business without a proper business plan, you can easily make it happen if you have an impressive strategy. And if not, the other tips discussed above can definitely help you get the money you need for your business.
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