Fashion Law Journal
Many business startups usually start with high expectations and the confidence of investors. A few situations, however, can either make or mar any start-up of a business. Here are a few tips on the process that you should pursue to secure the requisite financing for your start-up.
1) Bootstrapping your business
In order to excel in your business start-up for the first time, you need to ensure that you have some saved funds that you can easily access or funds that you can receive from friends or relatives. The process to use personal saved up funds or funding from friends and family is known as bootstrapping or self-funded.
2) Crowdfunding
Crowdfunding is the method of financing a project or venture by raising small amounts of funds from a vast number of people, usually over the Internet.
3) Angel Investment
An angel investor is a person who, usually in return for convertible debt or ownership shares, provides funding for a business start-up. In the initial moments and while most investors are not willing to fund them, Angel investors usually provide encouragement to start-ups.
4) Bank Loan
Banking institutions offer financial backing for lending to people with a sound business strategy who approach them. The business plan must be well formulated to convey the modus operandi, profit forecast, and expected time of maturity.
5) Business Incubators and Accelerators
In the start-up phase, business incubators, and business accelerators offer advice, assistance and diverse types of support for enterprises. The services they deliver can be found in major cities all over the globe.
6) Venture Capital
Venture capital funds are managed by professionals who seek out businesses with great potential with a sharp eye. Their modus operandi involves investing rather than equity in a solid business. In general, start-ups are based on an innovative technology or business model and are primarily from high-tech sectors.
7) Source Funds by Winning Contests
By participating in contests or competitions that enable entrepreneurs to exhibit or pitch their business module against other rivals bidding for the same funding for their businesses, thus is another incredible way to source funds. As a contestant, if you are looking to win over investor confidence, you are expected to present a robust and informative business strategy.
