Securing funding for your startup business can be a tough hurdle to overcome. Thankfully for entrepreneurs, there are now several options to choose from.
After a couple of years of uncertainty, the cost of starting a small business has started to rise. There is good news on the horizon, though — many small businesses are expecting business to pick up in the coming year.
And while more than 90% of startups are self-funded, there are options out there for securing outside funding to get your idea off the ground.
Of course, self-funded start-ups can keep complete control, and all of the equity. However, that’s not an option available to everyone — a great idea and a solid bank balance don’t always go hand-in-hand. If you’re looking for a little extra to get you going, here are some options.
In exchange for funding your startup, investors will typically require a portion of the company or stock, or a guarantee that they’ll receive a percentage of the profits. The first step is to work out how much capital you need, how many investors you can take on, and what you’re willing to offer them in return for their money.
Keep in mind that this is not step one — many professional investors will want to see that you have secured non-personal funds from family or friends, as this shows credibility.
To get a bank loan or credit, you’ll need a great credit history and solid business plans, including financial projections. But you may still struggle to secure a loan for a new business unless you are willing to put assets on the line.
You can also check out online providers who specialise in loans for small businesses. They can help you get your business started, and they can also offer advice on running your start-up — after all, it's in their best interest that you succeed.
Government support and community assistance are other ways to fund your startup. They can be highly competitive and involve a lengthy application.
This sort of support may also come from large businesses — Salesforce for Startups is a program that helps startups access resources and Salesforce products to get started the right way and grow quickly.
If you get the opportunity to pitch to prospects, lucky you! Here are some quick tips:
To find out what the landscape looks like for small and medium sized businesses, download the Small and Medium Business Trends Report.