One of the essential elements that should be taken into account when deciding to start your own business is the availability of money or the initial capital. For this reason, many potential entrepreneurs are seriously concerned about the problem of obtaining the financial means to organize their own business.
Although it seems that we live in a modern world where we have access to anything, many young entrepreneurs still don’t know all the ways and possibilities to get the needed funds. For this reason, many good ideas die at the concept stage and never see the light of day.
No one wants their business idea to follow such scenarios! That’s why we’ve gathered a list of sources where you could find the necessary funding for your idea:
1. Personal savings
This is the most obvious source of financing for a business. The advantage is that the contractor is not liable to the creditor and does not worry about having to pay the debts.
2. Risk investors
Venture investors give money to new business projects that have a high chance of being repurchased in the near future, although a significant portion of the risk always persists. They receive benefits in the form of a share in the business, a part of the profit or interest.
3. Business Angels Investors
"Angel Investors" are private investors who, unlike venture investors, are willing to invest their own funds in interesting and innovative business ideas, which are at the stage of a start-up . They focus on return of investments and subsequent high profits.
4. Private loans
Although many entrepreneurs have resorted to private loans, which involve borrowing money from relatives, friends and acquaintances, it is still recommended, as far as possible, to avoid this type of financing for businesses, in order to avoid mixing business with personal issues.
5. Bank loans
In order to obtain a bank loan, the entrepreneur must be prepared to pass a rigorous control by the bank's representatives over his credit history and financial stability. He must also take responsibility for subsequent payments, at a fairly high credit rate.
6. Advertising
If the entrepreneur is able to advertise his business project at an appropriate level, he has every chance to find suitable investors for a long period of collaboration. There are sites where you can demonstrate all the advantages of your existing business plan, thus increasing your chances of finding a suitable investor.
7. Economic development programs
There are a number of loan programs you can apply for, but it may take some time to find the one that suits you. Some of them give you the opportunity to cover your expenses in full, others may require small investments on your part. However, this type of program has a great advantage for novice entrepreneurs.
8. Corporate programs
Some large businesses provide support for startups and small businesses. For example, Greenville offered loans ranging from $ 10,000 to $ 100,000 to businesses started by disadvantaged or minority people, including women-owned businesses, in some parts of the world.
9. Grants
Like economic development projects and programs, they have a great advantage if you want to open your own business. There are a number of criteria that you must meet and if you pass the competition - you get the financial means necessary to develop your business.
10. Crowdfunding sites
Although people do not usually donate a lot of money, you never know where the value of your project can go. If an impressive number of people gather to support your cause, you can earn a considerable amount for your business idea.
To cut a long story short, in order to find the necessary funds for the creation and development of your own company, you must have a good business plan, be confident in yourself and your powers and strive to achieve your business goals.