Money, as they say, makes the world go round. And, without it, your small business is going to struggle to make an impact. There are countless things you can do to raise money for turning your idea into a genuine business, or achieving the growth you need. Some are obvious – a bank loan, for example, and others take a little more ingenuity. In this guide, we’re going to take you through some of the best ways to fund your new business of growth. Take a look and see if you can find the right solution for your company.
After the last financial crisis, there has been more business looking for other ways of raising funding. One of the most popular methods is a family loan. Let’s say that you have a relative who has a significant amount of savings that they have built up over their life. If it’s just sitting there earning a negligible amount of interest, then you could give them a much better return. And, with interest rates still low enough to irritate the life out of savers, it’s a good time to think about it. You will need to convince your relatives that you are a safe pair of hands and that you have a viable route to success. But, in many cases, the interest you agree on will be much lower than it would be for a bank loan.
Bank loans have become harder to get in recent years – again, thanks to the financial crisis of 2009. However, it’s worth investigating while interest rates are so low. The trick is to give yourself the best possible chance of acceptance. Make sure your business plan is watertight and exciting enough for the lender to see your potential. Be honest with your numbers, and also, ensure that you have plenty of experience in the industry. For example, you are more likely to find acceptance with trucking company loans if you have experience in a management position. You’ll also need to sharpen up your credit history – or find a partner with a whiter-than-white record.
Private investors can be a godsend to entrepreneurs although you will have to give up a significant amount of control of your business. Again, you need a robust business plan – only this time, the focus should be on an exit strategy. No angel investor is going to take a punt on you if they think you will just be around for the next 20 years making a little money here and there. They want to see a lot of growth, and a chance to cash in somewhere between 5-10 years.
Finally, if you have a product idea that will go down well with a mainstream audience, then crowdfunding could be the perfect solution. Head over to Kickstarter.com to find out how to get started. One thing to remember is that this will give you a lot of exposure, but it won’t fund your business. Crowdfunding tends to concentrate on product ideas, and the money you raise needs to be put towards delivering that product.