Human beings are a unique set of creatures. What differentiates us from the rest of animal kingdom is our ability to think, imagine and visualize. Our brains have the capability to identify a problem and find very realistic solution for the same. And that is where, an overly used and sometimes mispronounced word “entrepreneurship” takes birth. Entrepreneurs are people who have the capacity to identify a visible or sometimes a hidden problem.
They not only throw light to it but also provide a very reasonable solution(s). In that case wouldn’t all of us become entrepreneurs? So, what are some of us doing differently? The most common answer we come up with to explain why we are not converting our million-dollar ideas to million-dollar businesses is in fact not an answer but a question.
“But what about funding?”
Through this article let’s answer that question. Albeit not a new piece of information, I hope the essay gives you a brief summary of a few ways you can possibly raise funds.
1. Be Bold and Believe
If you have an idea and you know its epic, be the first one to invest in your business. I could put the sentiment in a dramatic way and quote, “If not you, then who”. Investing in your own company not only give you more control on business but it will also help investors to understand that you are serious about what you are trying to achieve. It will ensure the investors that even if the business hits a bad month or two, you, the proprietor will work through the problems. Not to mention funding your own is least expensive in terms of cost and control.
2. Ask and ye shall receive
If you do not have any way of raising money then you can always think about other sources. The most common one is asking your family or relatives. The major advantage here is that your family knows you well and it will give them assurance to invest in your business. And if your fear that you would lose control of the business to your relatives, you can always make and maintain contracts that would ensure clear and professional behavior where business is concerned.
3. Angels are Real
Before we understand, what an angel investor is, let’s get something straight and simple. An entity can fund you either through debt, equity or a combination of both. In case of debt, you will need to pledge something as an assurance that the person or institute funding you will not lose their money. You will have to pay back the funds borrowed plus a fee otherwise known as interest rate. But in case of equity, there is no collateral but the fund provider gets some kind of ownership position in the company depending on the fund given to the proprietor.
Angel investors are individuals who offer fund to start ups for a piece of the business. According to business news daily the percentage of business angel investors want in return for fund lies in the range of 20-25%.
4. Good old banks
Although banks wouldn’t be motivated to invest in your business at its incubation stage, it can and will provide funds for working capital against account receivables, inventory and so on. There are several schemes that will help you to receive funds from financial institution and this may vary depending on the nature of your business, the experience you have as an entrepreneur and the general atmosphere of the organization.
Understand that these are just some ways to raise money, now there are also platforms like crowd funding websites like kickstarter.com that can solve your fund related problems. At the end of the day if you really believe that you have the answer to an impelling problem then don’t let the hurdle “But what about funding” stop you from blossoming. Remember if the will is strong enough the way appears.