Funding: 7 Ways to get Funding for your Business
Funding is the act of making resources available for your business program or project. Though launching a startup can be exciting, yet many startups kick off with a lot of drive and aspirations, only to be disappointed when they do not realize their objectives mainly due to lack of funds.
This is so because getting access to funds in any economic climate can be demanding for business expansion, let alone startups that are just getting off the ground.
Given the present global economic downturn and our current state of affairs in Africa, getting funding might be tougher than desired.
But hey, don’t despair! For new entrepreneurs, we have compiled a list of ways you can raise funds for your business. Here are some.
Launch a crowdfunding campaign to fund your business
Crowdfunding is the act of funding a business project or venture through contribution or raising of small amounts of money from a large group of people via the internet.
If the funding is loan-based crowdfunding, it then means that investors that partook in the crowdfunding will at a set time, get their financial contributions back with interest. But if the funding was investment-based, then the invested money grows with your business, and your investors get a share.
So you can try launching a crowdfunding campaign and use the profits to fund your business.
Apply for a grant
Both the federal and state government, private institutions and organizations, usually allocate funds to business ventures and projects they feel would benefit the public.
You are expected to write a credible proposal to them to indicate your interest in the funding opportunity, persuading them of the impact your business will bring to your community. Your proposal will be evaluated and considered if it looks promising.
Many startups have gotten financial assistance through grants. However, their businesses were thoroughly monitored by the grantors for a period of time to ensure that the grant was used as agreed for business advancement.
Venture capital’s fund
Venture capital is a type of financing where investors provide high potential startups in the early-stage as well as those at scale stage with the necessary financial support they need. So as a startup, you can present your business to potential investors and after proper evaluation might give you the financial assistance that you need.
An angel investor is a financially equipped individual who supports startup businesses and companies by providing them with funds. This support is often given in exchange for an ownership stake in your business or company. This is to stay that as soon as your business starts yielding, both of you will reap the financial rewards.
Commercial institutions such as banks, finance companies and individuals who extend loans or credit in the ordinary course can give a level of financial assistance to your startup when you seek help from them. They add an agreed interest rate to the given amount which is paid at a stipulated time.
Bootstrap your business:
This is the process of patiently growing your business with existing resources. Some startup businesses have used their available resources to grow their business. They reinvest their business profits until it is fully stabilized. Funding your business this way requires a lot of patience, perseverance, hard work, and discipline because you are reinvesting your profit.
In conclusion, you can try any of the above funding strategies for your business and stick to whichever serves you best.