Helping business owners raise funds, I found that today it is much easier than before. Initial funds may get a company off the ground and help it grow. It may require work with the investors, and some of them will ask also for a direct say in making company decisions, but the potential upside could far outweigh the additional responsibilities.
I would recommend checking the following popular directions:
Borrowing: When you are just starting out, you might not be at the point yet where a traditional lender or investor would be interested in you. Consider getting the initial funds from your own resources, selling assets, borrowing against your home, maxing out credit cards, using 401(k), etc.
SBA: U.S. government-backed term loans are available. The SBA’s primary lending program targeting loans of up to $150,000, however the official maximum loan amount is $5 million.
Partnership: Add partner- investors which will forward money to the company for a guaranteed percentage of the business.
A later step will be to go to Venture Capital. Make sure that you have a solid Business Plan. Your success in obtaining funding stems directly from how strong the business idea is. The best way to investigate this is to get a detailed business plan together. The basic points of a plan include a summary of the company or opportunity, industry overview and details of the strengths, weaknesses, opportunities and threats (SWOT) facing the venture, as well as a financial overview, including past performance (if available), and projections for at least the next five years.
It is recommended to take advantage of some modern approaches such as Online Networking. The Internet is proving instrumental in helping small and start-up businesses gain access to capital. The advent of social media platforms, including LinkedIn, Facebook and Twitter, provide opportunities for entrepreneurs and business professionals to learn about each other. For instance, LinkedIn has a number of networks for firms seeking venture capital funding and want to learn about companies that may provide it.
You also may consider Crowd- Funding. There are dozens of websites that seek to connect individuals with entrepreneurs looking for capital. Kickstarter.com has turned out to be one of the more popular sites and is very appealing for Start-Up Firms, as individuals effectively donate funds in exchange for company merchandise.
Arik Hertz is a TAB Certified Facilitator and Coach, and manage TAB Northeast in the Greater Philadelphia area. With many years of experience in business management, Arik focuses on working with business owners, leaders, executives and managers to achieve their professional and personal goals through their business.