Easy Ways to Raise Capital for Your Start-Up

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The new year has set your entrepreneurial wheels turning with fresh and energizing business ideas. However, funding is the only way to transform these ideas into realities. This brings you to that daring question – how do you fund these exciting ideas?  According to statistics, 45% of start-up businesses fail due to the lack of capital or profitability, while 75% of firms backed by venture capital fail. Although these may take the wind out of your sail, there are several ways you can raise funds and expand your business. Ready to know how? Follow this guide

  1. Fund your idea

Funding your business personally is the most well-known practice in the early stages of a start-up business. Entrepreneurs and teams may also come together and pool their funds for the start-up. Funding your idea may require having some savings or assets you can utilize for the business. However, investing your funds into the company is an excellent way of communicating your seriousness about the business. Do you have any extra items you don’t use?  Selling a car you barely use or valuables you don’t need any more to invest in your business is an excellent way to realize your objectives.

  1. Speak to your family and friends

Your home could be one of the best places to raise funds for your business. With family and relatives aware of your abilities, they will be very willing to support you no matter the kind of business you are venturing into. Despite being an extraordinary way to procure funds and investors, it has its downsides like everything else. Loans and funding from loved ones may be worthwhile, but for others that may require expert guidance, an angel investor is the best alternative since your family or relatives may not possess the skills required.

  1. Start a crowdfunding campaign

There are different kinds of crowdfunding, which means you will have to find the one suitable for your business. Crowdfunding is a fantastic way for start-ups to raise capital for innovative projects or gather funds to back innovation on a large scale. Regardless of the type of crowdfunding you go for, it is generally as safe as placing your item on the market and getting capital to back your product. In 2013, Formlabs raised $3 million through a crowdfunding campaign to produce 3D printers for the public. Crowdfunding helps in several ways since potential investors will see marketplace adoption. If they realize other people are eager to invest in your project, they are likely to invest their funds too.  

  1. Find your angel investor

Angel investors are certified persons with total worth surpassing $1 million or a yearly income exceeding $200,000. They usually work alone or collaborate with other angel investors to structure a fund. Such individuals are a decent source of funding for your business. However, you must present a great business plan together with a pitch. Exhibiting the right enthusiasm and promising information about the current and future potentials will catch their attention. With several resources available, finding an angel investor shouldn’t be difficult. While Funding Post organizes showcases for angel investors, there are also angel investor platforms to schedule pitches.  

The vital lesson here is to understand that there are numerous alternatives for financing your business. While some may not work in your case, it is essential to remain optimistic. With due diligence and determination, you can raise the funding you require. Consequently, you will be free to expand your business since your budget will no longer hold you back.

(Cover Image Source: Pixabay)

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About Author

Larry is the father of 5 wonderful kids. He has his normal "offline" job but has also been running an online business for over 15 years. When he is not working on websites or blogging, he enjoys video gaming and watching sports.

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