Start up entrepreneurs always have big dreams of how their company will scale up, how they will manage it and the amount of profit they are likely to take home at the end of the day. However, before all this is realized, the elephant in the room is always capital to jump start the idea.
Entrepreneurs can learn how to raise such capital through a process that obviously requires more creativity and out-of-the-box thinking. Business model, projections and how best you can sell yourself to potential financiers are crucial when looking for funds because the partners will only invest in your ideas they are convinced will give them a return on their investment.
As an entrepreneur looking for start-up capital, you have to be flexible, remain positive, and stay vigilant to realise impressive outcomes since this will answer the question on how you intend to eventually return capital to your shareholders (including yourself).
Below are four simple ways to get started:
Small business loans: Going for loans in financial institutions when coming up with a new business is a potential option any entrepreneur should consider if you do not have any credit. To successfully get such borrowings, what the financial institutions will require from you is good business plan, profitable projections and some of their own money in the game.
It is therefore important to set realistic objectives that can deliver achievable goals within the set period of time because when that time elapses, the banks will want to start getting back what they invested in you.
Friends, family: Even though this sounds risky on your personal relationship should the business fail, funding from friends and family has been for a long time popular and effective way to raise initial capital for a business. However, at this point it is proper to be franc enough to borrow adequate amount structure this type of funding as a high interest loan for like a period of one year. After this, you can develop some additional pitch material if you want to go after big money for example you can come up with your website to market and let people know what you are dealing on.
Engage angel investors: angel investor provides more favorable terms compared to other lenders since they invest in the entepreneur starting the business rather than the viability of the business with their key focus being to help start ups take their first move rather than possible profit they may get from the business. they therefore provide better grounds on which you can build your new business as an entrepreneur.
Start it yourself: Most entrepreneurs these days opts to fund their projects for a significant amount of time until more formal funding opportunities become realistic. This can be done by injecting your savings and zero interest credit cards to leveraging other personal assets. Investing your personal cash is a good move for a start-up since it will easily make other investors more comfortable knowing you have skin in the game and is determined to keep it to the expectations.
SOURCE: BUSINESS TODAY