Have you been seriously considering launching a brand new start up business? While your dreams are easily within reach on paper, it can be difficult to get your doors open to launch when you’re short on funds. Balancing a budget to ensure your new business is a complete success means having enough capital in place to hit the ground running.
Here are just a few ways that you can raise money or seek the right capital to get your business off to a good start:
Set Up An Online Or In-Person Fundraiser.
If you’re really hurting for a chunk of capital to get your business off to a good start, every penny counts. One way to seek the amount of money you need to gather accounts and start producing an income from your business is to hold a fundraiser. There is the traditional fundraising platform that involves gathering the public, close family, friends and pillars of the community to one large event. From there, you can ask for donations or other forms of monetary support to help your business get its start. Another option is a cloud sourcing. This allows you to seek out capital through an online fundraising event. You’ll first have to be able to share your business plan and vision with potential donors in hopes that they will believe in your idea enough to see you succeed. If you’re seeking to launch a franchised business, there are added benefits of owning a franchise as opposed to a single-proprietor operation. You may actually get more support with start-up costs from the main company.
Look For An Investor.
Seeking out someone else to go into business with you may be beneficial if they can front the amount of capital that you need. An investor can be a publicly shared entity and be a part of many of the business decisions being made. In some cases, an angel investor may wish to be silent and only appear on paper. Silent investors may work behind the scenes offering advice and services without going public. This is a good option if you have someone that shares your vision for success and believes in your business plan.
Borrow Against Your Assets.
One way to get access to some cash for your business launch is to borrow against your assets. Some examples of what you can borrow against include:
- Vehicles that have high value or worth, such as a classic car
- Homes with significant equity
- Margin loan against certain valuable stocks and bonds
- Other businesses
- Life insurance policy for borrowing against or cashing out
- Recreational vehicles including boats and motor homes
Make sure you have consulted with your attorney or financial advisor before borrowing against your assets, as you could be taking a huge financial risk.
Seek Out A Microloan Or Grant.
There are several loans on the market that appeal to existing and new business owners. A microloan is a type of loan that allows you to borrow funds related to starting a new business. According to the U.S. Small Business Administration, the average microloan borrowing amount is around $13,000. If you have good credit and meet borrowing criteria, this type of loan may be beneficial to you. Visit your local financial institution to go over their loan programs and find one that fits your needs.
Another option may be grant funds. Grants are available on a variety of levels including:
- Private donors
Shop around for grants. Choose one that appeals to your business type and pitch a letter and submit the proper application to apply.
Tap Into Your Savings.
Your business will need working capital in order to handle the ebb and flow of cash issues coming your way. In addition to a variety of startup options, it’s important to invest a portion of your own money into your future. Keep in mind that you may be more critical of spending money if it came from your own pocket. This allows you to know exactly where your money is going and gives you an added sense of responsibility as you build your business with your own funds.
Getting your business off to a good start can be challenging — especially financially. Using multiple methods of funding is the best way to gain capital and put the most money in your bank account prior to your business launch.