No matter what you can say, we are in the golden age of entrepreneurship. We have become a generation where companies such as Google or Apple have taken the cornerstone of a concept and developed them into corporate entities. But even with this fast emerging market, the same problem continues to hinder the success of many startups and new entrepreneurs. That problem is funding.
Finding capital for a new business can often be challenging, especially in this economical climate. Securing these types of funds can be the difference between failure and success. To help you find the necessary financial funding you need to operate and optimize your business to the fullest, here are six helpful and advantageous tips you can utilize to get you and your company on the right path. By following these tips, you will be able to build up a sufficient amount of capital to clear any financial hurdles awaiting your new future.
1. Be Realistic
When it comes to your business, you want to make sure you have a business plan that is scalable, profitable, and tangible. Essentially it comes down to you having a deeper and realistic understanding of your finances. With revenue always comes cost. As you analyze your business on the financial aspect, ask yourself what are the necessary expenses you cannot avoid and the expenses you can cut out. In addition, take into account how scalable your product or business is. If you find that you are able to cut cost, but your revenue is stagnate, that can hinder you opportunities in increasing your profit.
2. Network, Network, Network!
In the world of entrepreneurship, cash encourages entrepreneurs to move beyond their social circles and access a larger pot for financial funding. For your business, this will be a strong opportunity to get the word out and find new and exciting investors for your company. During this process, especially when you network with individuals looking to invest in your company, you will inevitably have to pitch your business. Make sure you work on your public speaking skills. Be confident, captivating, and memorable. In addition, make sure you know the ins-and-outs of your company (which is why the first step is important). Being able to answer any questions regarding your company’s vision, goals, and finances (such as revenue and profit) can be the turning point in finding a huge backer or walking away with nothing.
3. Do your Homework
This is something you will be constantly doing every single day. It goes without saying that overnight success does happen too often. To increase your probability for success, make sure you do your homework. Go beyond the outdated plans you had last month and reflect on new paths in how to scale your business. In addition, know the people you are talking to. If you are talking to an investor, make sure you know their background and purpose for the company. Understand the position you want to put them in so that they can feel comfortable investing you in. Remember, as much as they want to invest in the company, they are also looking to invest in you.
4. Get a Bank Loan
If you are a startup company that is trying to establish their business in their specific niche or field but do not have the capital to get operations moving, try looking into a bank loan. Loans for these types of situations are often a very common method for small businesses. If, however, you are looking for something financially smaller to get your foot into the door, try securing a microloan. Certain microloans can range from $500 to $35,000. At the end of the day, you want to be realistic with the amount you get. Analyze your finances and see what loan and amount is the best fit for you.
5. Alternative Funding Sources
One popular financial source many companies and entrepreneurs are starting to use various crowdfunding sites like Kickstarter.com or gofundme.com. Crowdfunding sites are a fantastic and effective way to market your product and business to the public. In addition to marketing, the sites themselves give you an opportunity to raise a specific amount of capital to fund your business or your projects. For this to work, you need to make your product appealing. This goes back to doing your homework. Make sure you know the ins-and-outs of your business and your products. Discuss the company’s history, how the product came to be, and the benefit the product can be for the entire public. To further enhance your business’s popularity and increase donations, create high quality videos, pictures, and marketing ideas that can hit home to a variety of people.
6. Give Up Some Ownership
One mistake many entrepreneurs make is that they are too stubborn to give up partial ownership for the betterment of the company. Providing an equity based-crowdfunding or ownership to your investors can provide you with the necessary funds to launch your business to the next level. Many big companies have succeeded on this idea especially when scaling a startup into a big business.