There are many finance sources available for entrepreneurs. You just need to know which one is the best for your company as young or small business owner.
Are you a startup entrepreneur looking for funding? Here are some typical source of funding options for entrepreneurs, that should provide you with a good amount of inspiration for your business funding decisions.
As an aspiring founder of an enterprise, you should have some savings left yourself. You can invest in your own company’s finance. However, you don’t necessarily have to invest in terms of cash. If a co-founder or partner invests his/her hours in helping you start your business while also working his/her own job, that is also an investment.
In terms of investment size you can go all out, as far as your bank account allows you to. The advantage of this form of investment is that it can be perceived as positive by an external financier that a founder has some “skin in the game” as well. Why would another person take the risk of investing in your company if you have never been prepared to take the risk yourself?
Crowd funding has emerged as a new medium to acquire money for your business. The growing popularity of crowd-funding sites such as Kickstarter has made it a viable option to get your startup company off the ground. If you are young, passionate and energetic, you have a much better chance to secure funds for your business through crowd-funding campaigns.
Whether you are looking for short, mid or long term financing for your new company, banks are the best place to get it. Make sure you generate enough revenue to repay the bank loan and its interest.
Banks offers you flexible loan payment options, which makes the loan repayment journey easier for young entrepreneurs. Unlike other financial funding options, banks will give you a contract to suit your needs.
Friends and Family
Have you ever considered pitching your business model in front of your friends and family? The best thing about getting friends and family members to fund your business is that they are less demanding. They will ask you a small compensation in return for their investment. You can also consider making your friend or family member your business partner.
If you are lucky enough to live in country with many venture capitalists, then you should focus on pitching your business model in front of them and get your startup funded.
These venture capitalists invest institutional finance into startups, which has a growth oriented business model. A venture capitalist will only invest in your startup business, if he or she sees huge growth potential.