4 Ways to Fund Your Startup
Like it or not, the truth is that money means a lot to startups. Money gets the ball rolling and it is needed to get your business started. Knowing how to fund your startup is one of the first big obstacles that you will need to think about and overcome in order to get your business going, start production or begin manufacturing.
The good news is that there are several ways to finance your startup. What works for one business might not work for another. Here are some of the ways you could look into funding and see if it works for your business plan. You’ll want to know repayment details and interest rates before signing up. Then you can determine what will help make your business viable.
Friends or Family
Your first customers will likely be your friends and family. How about looking to them to help you finance your business, too? There are many ways that your family and friends can help with your startup. They could offer donations, small personal loans, invest in the business for a return, or help you with the skills to get things going. They can be a good first port of call.
In the technological age that we live in where everyone we know is on social media platforms, crowdfunding could be a good way to fund your startup. Donators will pledge a certain amount of money to the cause. If the amount of money is reached, then the payments will be taken and they can get something in exchange. Often, it could be things like a sample of the product range or a discount on the first product. Crowdfunding can help to get a community around the business too, as you have people that are going to be ‘invested’ in the outcome.
One of the most traditional ways to fund your business is through bank loans. This happens when you speak to your bank and show them your business plan and the amount of money you need to borrow. The interest rate can vary as some businesses will be riskier than others. With a limited liability company, bank loans can be a good choice, provided that you have a stellar business plan.
If you need money fast, then a business credit card can be a short-term fix. Having said that, it does need to be for money that you know you have coming in. Otherwise, it can lead to debt and paying interest, which isn’t what you want when starting up your business. Keep in mind that credit cards should only be a short-term option, and not something to continuously fund your business.
Have you got any experience with these four options? With a good business plan, they could all be viable options for you.