The internet has brought about changes nobody foresaw. People do everything online these days, which is why today’s entrepreneur focuses on tech startups more than anything else. You have a great idea and you’ve pitched it to some well-known businesspeople in your community. The feedback has been beyond your wildest dreams, but none of them are willing to put their money where their mouths are. How can you open your doors without financing? There are some options that might work for you.
1. Angel Investors
With this first option let go of one thing right away: You will not be Supreme Boss, which is what you plan to make your title. Angel investors are rich people who love to put their wealth into new businesses. This type of investing carries with it huge risk, which is why anyone who invests in your new company as an angel will want a share of ownership and managing rights. Don’t discount this option. This works to your advantage, as these investors have business know-how you don’t have that they bring to the table. They can help get your startup off the ground with crucial advice and management.
2. Bootstrapping Assets
If you insist on being Supreme Boss, take a look at what you have that you can put into your startup. This includes your home, automobile, savings, retirement funds, and any line of credit or credit cards. When you take your assets and cash them out or borrow against them to fund your business startup, this is called bootstrapping, and you need to bootstrap a little even if you plan to get money elsewhere. People won’t invest in your idea if you aren’t willing to financially back it, as well, so what can you borrow against or take out? Don’t strap yourself too tight but plan to put some cash up yourself.
3. Crowdfund Campaigns
Crowdfunding is another internet darling many couldn’t have predicted. From funerals to hospital bills to legal fees, people open crowdfunding campaigns in droves on funding websites. You might think this funding is only for personal uses, but there are business crowdfunding websites on the internet, too. Do a search for them and find one that applies to your business idea, i.e. tech startup, retail startup, food startup, etc. Once you find the right one, write a riveting campaign to which people cannot help but donate. Include your business plan and how you plan to market your startup. Write detailed plans.
4. Family and Friends
Of course, nothing is more important to your family and friends than your success, so why not approach them for a little help? If you have a family member or friend who is in the niche in which you wish to open your business, approach him or her for advice and possible funding. Another option to is to partner with that family member or friend and then separate businesses once your company is on solid ground. You’d be surprised how much your loved ones want to help you, so don’t be shy. Approach those you trust with your idea and see what they’d like in return. Your grandfather might invest for a small share.
5. Microloans
The U.S. Small Business Administration was enacted in 1953 to help small businesses get off the ground. The administration understands how crucial smaller companies are to the local, state, and national economies. Business spurs economic growth, and the SBA offers microloans to startups that are easier to pay off than big bank financing. A microloan works much like a traditional loan, you will have to apply and qualify for the loan, but you can receive less money than a big bank loan, which is easier to pay off, and extended terms to help you build your operating capital easily. Consider grants, too.
6. Venture Capital
Finally, once you’ve opened your doors and it’s time to grow, look into venture capital. Chris Sacca is one of the most famous venture capitalists in the United States. After helping Google, Inc. build its empire, Sacca opened his own venture capital company, Lowercase Capital. Some of Sacca’s investments included Instagram, Twitter, and Uber, and you know the heights these businesses reached. When the time is right, VC financing can help your business grow. Unfortunately for you, Sacca retired from venture capital investing in 2017, but who knows? Maybe he’ll come get bored and come back.
These are just some of the options available to you to get your hands on the cash you need to start your new business. You’ll also need determination, dedication, and a willingness to lose your life for about a year. Many businesses shutter their doors and windows within the first year of operation, so make certain you have enough blood, sweat, and tears to get your business on track and keep it there. You can take a vacation once it’s turning a profit. Until then, work hard and become the next millionaire. Your business will be on the Fortune 500 list in no time!
