This is a contributor’s blogpost …
Many businesses require funding in order to get started. This could help to cover the purchase of equipment, licensing and even recruitment costs for employees. Here are five ways to fund your startup.
It’s possible you may already have savings to dip into. If not, you could always open a business savings account and start saving towards your entrepreneurial dreams. Business savings accounts often offer more interest than regular savings accounts – you can compare them at sites such as moneysupermarket.com. Saving up funds can take a lot of time and patience and may not be suitable for those that want to get their business started as soon as possible.
Take out a bank loan
Bank loans are often one of the best forms of borrowing money for a startup. Interest rates are generally low and you can borrow large amounts. That said, you may need to have a good credit score to apply to these loans. There are lots of services out there such as fixmy.credit that can help to repair your credit score and increase your chances of being accepted for a bank loan. Be wary that some bank loans can take a few months to process.
Take out a loan from a private lender
There are many private lenders that offer business loans. Some of these don’t require a good credit rating and you may even be able to get the money in your bank the next day, however they often come at the price of high interest rates. It is still worth shopping around to see what’s out there. Alternative options such as lines of credit and peer-to-peer lending could offer less interest.
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Seek out an investor
You may be able to seek out an investor to give you the money. This is usually done in exchange for a share of the company’s profits in the future. Encouraging an investor to back your startup involves having a solid business plan in place – they need to be convinced that your business will work and make a profit, otherwise they won’t want to risk investing in you. Try to seek out an investor that you think will be interested in your company – this should ideally be someone with interests related to your field. There are also investment companies that you can go through, which you can find online at sites such as theaic.co.uk.
Look into crowdfunding
Crowdfunding is a form of investing that involves raising funds from lots of people. If you’re asking for a large amount, but you don’t think a single investor will give you that amount, crowdfunding may just be what you need. Kickstarter.com is the most famous crowdfunding platform and allows investors to give you money depending on whether they believe in your cause. There are many other sites that could also be worth looking into.