The importance of capital or seed funds to starting a new venture can not be undermined as this is the driver of any venture especially when getting started. Before moving towards fundraising it’s always advisable to start by bootstrapping (using your personal funds), In many cases, using the money you have instead of borrowing or raising is a great approach, in fact, some entrepreneurs continue to bootstrap until their business is profitable. This can be beneficial because it means you won’t have extensive loans and monthly payments that bog you down, especially if you run into drawbacks along the way.
Below is a list of ways you can raise funds for your new venture
Get a Job or a freelance gig: This is one of the most common ways used by most entrepreneurs especially the ones bootstrapping (self funding) the earnings from your job or freelance gig after getting it can be used to kick start your new venture since business takes time to become profitable this is a good option as it can also be used to take care of your bills. Another advantage of using this method is that it’s easy to get support because it will make people that want to support you feel your business is worth it if you can spend your money to get things started.
Loans: This is also one of the ways if not the most common way used by most entrepreneurs to get funding for their new venture. Loans can be gotten from banks, friends, families and also digital lenders. Digital lenders come as a very cool option to me because the loan is easily accessible, quickly dispensed with no collateral. Few digital lenders are Carbon, Branch, Sokoloans, quickteller loans and quickcredit.
Support from friends and families: You can also solicit support from friends, families, colleagues, boss and other loved ones, talk to them about your idea and ask them to support you no matter how small what you get from them might be appreciate them as the little you get from the would also help.
Crowdfunding: This is a method of raising capital through the collective effort of friends, family, customers, and individual investors click the link to learn more about crowdfunding.
Microloans: microloans are granted by institutions to individuals who would not normally qualify for a traditional bank loan. Learn more about getting microloans.
Grants: A business grant is a sum of money given to a business in order to help them start their business and also support their growth. examples of them are TEF (Tony Elumelu Foundation), YouwinNigeria and so on.
Learn more about grants.
Contests: Almost the same as grants but as for contests it’s more like a competition to test the ability of every competing entrepreneur at the end of it all the winner is granted the seed funding or prize.
Venture Capitalists: This is also another method but it’s mostly used by people who want to scale or grow their business at times it’s also used at the idea stage of a new venture. learn more about Venture capitalists.
Angel Investors: Angel investors stand out from other types of funding options because they are always on the lookout for the next business to invest in. they are quite similar to venture capitalists but what differentiates them is their tolerance as VC’s always want to have a say and also control. Learn more about Angels here.
Let us know what you think by sharing your opinions with us in the comment box.