You have worked on your business idea, you have done a lot of research, and now you are ready to launch your business. What next?
That’s Right! You Need MONEY.
Irrespective of your business size, you need money to materialize your business idea. Unless you have reserve funds, or friends and family ready to fund your business, financing your business can be a great problem.
How to Fund Your Business if You Do Not Have Money?
Whether your business is small, moderate or big, you still need money. If you do not have your own money, how can you fund your business? You can ask your friends and family.
In most cases, you will be able to raise funds for your business. However, if your business needs a lot of money, funds from friends and family may not be enough. Here are some of the options to choose:
Get a Small Business Loan
You can get loans from banks or other financial institutes. However, getting a loan involves a complicated process and you have to do a lot of paperwork.
You can also finance your business through lending sites. There are a lot of websites where you can find people willing to invest in a business. However, this may not work because most of the sites are location sensitive, they will only finance business in a certain location.
Even if the lending site accepts your location, it is not easy to get a loan because they have complicated verification process and credit score checks.
Find an Angel Investor
There are individuals interested in financing a start-up project. However, in order to attract people to invest in your business, your business must show potentiality and your business also needs to have an existing framework. For instance, your business must be already started.
If your business model does not attract investors or if your business is not started yet, it is difficult to find angel investors.
Financing Your Business Through Crowdfunding
If reaching your friends and family, getting loans or finding angel investors is not working, you can try crowdfunding. Crowdfunding can be one of the best options to finance your business.
What Exactly is Crowdfunding?
Crowdfunding, as the name suggests, is a way to fund your business, personal and social cause or campaign by inviting common people to donate on your campaign.
In other words, crowdfunding is a way to raise money through the donation from the common people. You can do crowdfunding in two ways, one by organizing events and asking people to donate; another through crowdfunding site.
Crowdfunding can be two types, one where you do not have to pay back, two you have to provide returns as cash, rewards or some sort of incentives. So, how do you raise money through crowdfunding?
As mentioned above, you can start your crowdfunding campaign, online or offline. For online crowdfunding, you join a crowdfunding site, start a campaign, promote your campaign through various means, and encourage people to donate.
If your campaign receives a donation, you can use that money to fund your business or any cause. As far as offline crowdfunding is concerned, you start a donation campaign by organizing gatherings, events, or social campaigns.
Crowdfunding Sites for Raising Business Capital
There are a lot of crowdfunding sites where you can start your campaign and raise funds for your business. Here are a few popular crowdfunding sites that you can use:
GoFundMe: Generally speaking, GoFundMe is for starting a personal or social campaign. However, you can also start a funding campaign for your business.
Kickstarter: If you want to raise funds for your business, Kickstarter is one of the best crowdfunding sites. Whether you want to build a website, print a book, manufacture a product, Kickstarter is for you.
Indiegogo: This is similar to Kickstarter in a sense that you have to provide some returns to those who have funded your project and this return is referred as “Perks.”
These are just a few examples of some of the popular crowdfunding sites. You can do online search to find more about these crowdfunding sites or more crowdfunding sites.
