So, you’ve had a brilliant business idea, and now you want to start working on your new startup. However,you’re a little short on cash. You can always look for financial options to help you in your quest. But what are the ways? Well, worry not, because there are 7 ways to finance your startup, see it here for detailed information:
- Personal Savings – No one else will be willing to put in their money if they see you contributing less when it’s your idea. You need to fund your startup using your savings. Don’t spend all of it, but at least put in a decent amount until the business sustains itself. You can use your job to keep aside a specific amount for your startup.
- Loans – There are several private companies and financial institutions which offer fresh entrepreneurs microloans for their startup businesses. Borrowing cash to invest in your own business is a plan which has been used for a long time. If not for the company, you can even take personal loans and invest the amount in your business if you are getting lower interest rates.
- Friends – People who trust you and believe you’re the best sourcewill be willing to lend you some money, especially when they know it’s being used for a very productive reason. However, it also comes with its problems. You can give them a stake in your company relative to the amount they invest.
- Crowdfunding – There are a ton of sites and organizations which have been established to help entrepreneurs by giving them the funds they need. It’s similar to when shares are put out for buyers to buy, except the buyers here invest in the product/company and in return, get the product they’ve paid for itself. However, it requires a lot of establishment on the startups part, and hence it means more work for you.
- Credit Cards – This is suggested when you already have a contract but are short on cash for the inventory you need. It’s the most suitable choice when you and your startup can pay the dues before the interest is charged.
- Peer-to-peer – It involves a group of people coming together to invest in a particular idea. It’s like a partnership firm. But the people expect a decent dividend as returns.
- Angel Investors – The idea behind this is to have everything on your business’s part planned out and to look out for anyone having a big pocket to be interested and invest in your idea. They will ask for a part of the ownership, but that’s a cost you’ll have to pay up to get your business rolling.