startup business getting funded by the investors

These days’ startups are on the rise and there are lot of ambitious people out there who want to lead a business. However, it is quite a common fact that not all startup businesses do well. Apart from other factors, the primary factor that can hinder the growth of these startups is capital or funding. Yes, that’s a harsh reality of startups.

Any business will require a good funding source to grow and survive in this competitive era. Therefore, raising capital for your startup is the first and most important aspect. Here, we will discuss 9 different funding options to raise capital for your startup business.

Self-help is the best help

This proverb holds good in every field and startups are no exception. Self-funding often known as bootstrapping is believed to be one of the best and most effective ways of raising fund for your business. In this way, you can fund your own business and lead it to success. The biggest advantage is that the entire money belongs to you and therefore it all depends on you how to utilize it and convert to profits.

Therefore, if you are the one who was born with a silver spoon or you have the necessary capital saved in banks all these years, then you can definitely start your own business. Also, another good thing of self-funding is that if your business doesn’t work well, then the loss is entirely yours and vice versa.

Raising funds by winning contests

This is a very new yet popular method for raising funds. What exactly happens in this contest? Well, usually the startup owners are invited to give their presentation and inform the judges about their company. They need to give some background of the company they want to start, their objectives, goals, work plan and how they strive to achieve their targets. The judges in these contests are usually investors who want to divulge their funds into these startups. If you are successful in impressing the judges, you get a huge fund for your startup. The key line here for success is ‘Be Prepared’.

Banks are saviors

The first thing that comes to our minds when we think about the word fund is ‘banks’. Yes, of course taking a loan is one of the convenient option to raise funds for your business. Therefore, if you are really thinking of owning a business and do not have any funding source, approaching the bank is a great option.

The advantage here is you can get a loan easily with or without a guarantee. The disappointment here is that the interest rates on loan is high. However, if your startup does well then you can easily repay the money. If not, then what is a business without risk.

Funding through NBFC’s

Non-Banking Financial institutions are another such body which can always finance your business. In countries like USA, Australia, Canada etc, the NBFC’s have gained significance importance and are sometimes larger than banks too. However, a guarantee is definitely needed against the capital and interest rates are also very high. If you are looking for funds, then such financial institutions can be of great help for your startup.

Raising funds from family or friends

This is another great way to raise funds for your startup. Who else can come to solace when you are in need. You can share your ideas with friends or make them as partners in your business. If they really like your idea and see the potential in you, they will definitely invest.

Also, the best part of taking help from family and friends is that you can buy a longer time to repay them and also you will get great advice from them to run a business. More ideas and thoughts can help a lot in the long run in any business. 

Try Crowdfunding

What is exactly the meaning of the term ‘Crowdfunding’. Let us make it simple for you to understand. Crowdfunding as the word suggests is a method of raising funds from the crowd. It is a win-win situation for both the parties.

As a businessman, you get the necessary funds required for the startup and the investor gets returns for their investment. These types of funds are mostly raised through internet. You need to convince the investors that your business idea is the best. Also, you need to prepare a business objective that appeals to the masses.

Venture Capital can be an option

A venture capitalist is an investor who like to divert their capital into new technology and startups. Now that does not mean that all the venture capitalist like to do the same. However, if you feel that funding is the only hindrance in your startup and you can actually make your plans work out then approaching such an option can be great.

However, you need to keep one thing in mind that it is very important to convince them about your project. Hence stay grounded and approach a venture capitalist with confidence and strategies. The money can be all yours!

Your life is set with Accelerators and Incubators

These terms may sound very new if you are a newbie in the world of business. However, they are very famous and can be your godfather in business too. Incubators help to start and establish a business whereas accelerators make your business run. Usually in a startup, you not only need capital but also advice and some form of experience.

The accelerators and incubators are thoroughly involved in training an individual and providing the required finance to them. They are considered to be one of the best options if you want to get trained as a business along with generating the necessary capital from them.

Get funded through Government programs

These days even governments are actively involved in funding the startups. It is usually based on a belief that startups come with new ideas, innovations and technology that can bring a radical change in society to be specific and to the world as a whole. Every year government is funding more and more startups and you can be the lucky one to get a funding through these programs.

Funds are undoubtedly necessary for any business and there are several methods of raising the same. Some people even opt to sell assets to raise funds. It depends on one’s business and the ideas behind it of how to raise funds. Different startups have different needs and ways of generating funds, so be do a thorough analysis and see what works best for your business before going for any of these options.