You’ve got to have money to make money. Anyone who is looking to set up a new business knows that you don’t just get up one day with a good idea and expect it to come to fruition without some level of investment.
It is at this stage of the entrepreneurial journey that so many fail – literally at the first obstacle. In many ways, securing some kind of funding at this stage is a massive sign of someone else’s faith in your vision – it confirms your own belief in what you are doing, and your ability to follow it through.
Notwithstanding, while one person might not see your vision, another will – this is the first and most important lesson to learn when setting up your own business. Persistence. Without persistence you will miss out on so many opportunities.
Equally, persistence generates its own energy and momentum. Shrugging your shoulders and admitting defeat puts an immediate stop to that energy, so if you get knock back after knock back, learn to learn from them, and keep your own faith.
Local business funding grants
You may want to check out your local Chambers of Commerce and business support groups. These organisations will have access to a wealth of different bodies specifically aimed at grant management resources that specifically help new businesses get off the ground. If your business focus is socially focused, geared towards helping a community issue or solving a local problem, there may be grants available to help you get your project off the ground.
Beyond that there are various other funding avenues that you can explore.
Crowdfunding has grown massively in popularity thanks to the significant reach of online social media platforms. In short, a crowdfunding platform will help you attract investors to your business – primarily through encouraging small amounts of capital invested by a wider range of different investors. For many investors this enables them to spread the risk of investing by ledging smaller amounts of money – some projects ask as little as $10, others are after many thousands. Whatever project you are working on, crowdfunding has proved a viable platform for thousands of businesses to raise millions of dollars, sparking an explosion of entrepreneurial spirit driven by the power of the internet and global connectivity.
The next step up from the crowdfunding route is to approach angel investors. Different Angel Investor organisations bring together a smaller number of higher net worth individuals who have a specific interest in investing in and supporting new businesses. Think Dragons Den, where established businesses go in to pitch their business ideas to a panel of investors.
Angel investors tend to get more hands on in the businesses in which they invest as they are often risking large amounts. Usually, they will only work with businesses who can already demonstrate strong growth and good trading.
Traditional banks and other financial institutions
Traditional high street and commercial banks are still a potential source of funding for businesses, though the landscape in the way these banks operate has vastly changed over the last couple of decades. In the past your local high street bank would assign a personal representative who you would get to know and build up a long term relationship.
These days that personal relationship no longer exists. Central administration and communication that relies on systems rather than people has taken away that personal touch which means raising finance is based on your ability to tick the right boxes, rather than that personal knowledge of someone’s knowledge, experience, professionalism and background.