Finance is the lifeline of every business. If yours is a new one, you may not even be able to function without the required finance.
Funding your business with your personal savings might seem the best way. But not everyone will be able to adopt this approach. At some point in time, you will have to look towards diversifying your financing sources if you want your business to survive for long.
Here are a few ways to make sure your business keeps getting the funding to meet its requirements:
#1. Borrow Money
You can borrow money from your spouse, siblings, parents, relatives, friends, or co-workers who might be ready to lend you. You can repay them once you start making profits from your business. However, there are a few things you may have to consider:
- Keep things simple and clear
- Make sure they don’t expect to have any equity in your business
- Keep your personal and professional relationship separate
- Make sure they have the capital that you need
#2. Venture capital
If you search, you can find many venture capitalists who may be looking to invest in technology-driven businesses that offer high potential. If you are into information technology, biotechnology, or communications you may have better chances of finding a venture capitalist for your business. You will have to give away a part of ownership or equity of your business; but you will get a mentor who will bring to the table, the required knowledge and expertise that will take your business towards great heights of success.
#3. Angel investors
If you are in the initial stages of running your business, getting an angel investor can do a lot of good to your business. There are many who are ready to invest anywhere between $25,000 and $100,000 in startups. They also bring in knowledge, experience, and a lot of contacts. In return, you may have to give them the right to supervise your company’s management. Offer absolute transparency by including them in your board of directors.
#4. Business incubators
Also known as accelerators, business incubators focus on providing support to businesses in the high-tech sector. They offer you their premises along with technical, logistical, and administrative resources. For instance, you can probably get a laboratory to test your product before launching it in the market. There are also many economic development incubators that focus on creating jobs, hosting and sharing services, and revitalization.
#5. Government grants and subsidies
If your business qualifies, you can get grants and subsidies from the government to fund your business. However, there will be tough competition for such subsidies and grants and the criteria are generally very stringent. Most of the times you may have to match the funds that you will be offered and this depends totally on the granter.
Trading is also one of the ways to ensure your business keeps getting the finance that it requires. You can try Forex trading, stock trading, or bitcoin trading. Make sure you read bitcoin profit full review before trying it out.
Creating a detailed business plan will be essential before you try any source of financing. Make sure you have a detailed plan with a full description of your business, the benefits of your project, and the entire costing.