Funding your business is no small feat. It takes time, effort, a lot of thought and very often is a labor of love. If you already have your business start-up idea or looking for the best franchise to own, then you’ll be either starting to save or looking for the best ways to get started. In this article there will be a couple of options, not every financing avenue will suit every person, so look at what will suit your situation.
The first and most obvious route is a bank loan. Although in previous years, it has become a little bit harder to get a bank loan for a start-up and this is particularly hard if you don’t have good credit or any other assets, it still might be worth exploring.
Crowdfunding, this one has seen a considerable rise in the last few years and can be very successful with the right marketing and PR behind it. You’re more likely to be successful with a physical product that people will receive at the end, but it has been used to fund art shows, coffee table books, cameras and more. It is worth considering but only if you’re going to put the effort into doing it correctly.
If you have a business plan that meets specific social or regional criteria you might be eligible for small business grants or awards. Spend some time online and look at what is available and see if you might be the right fit. It’s usually a long but worthwhile road to secure grants, so make sure if you are going for this source of funding you follow the application process to the T.
If you are heading down the franchise route, some companies specialize in franchise funding options. Once you have your business paperwork, are ready to move forward and maybe have saved up some personal funds to help, then start reaching out and looking at what options are available.
A risky option is using your 401(k). If you are currently between careers and considering a start-up, the funds you’ve banked so far in your 401(k) can be put to use. You’ll need to get in touch with someone who knows what they are doing when it comes to setting up a C Corporation and a suitable retirement plan to put your assets into. Remember that a lot is riding on this type of finance option, if your business doesn’t work for whatever reason, you have also lost your retirement nest egg too.
Perhaps your idea is going to attract a celestial being? An Angel Investor is an affluent individual, who enjoys funding business start-ups and usually requires a stake in the company. The details are all down to you and the investor, but it can be a very harmonious relationship if you both get what you want from the exchange. Angel’s use their own money and are held accountable to the Securities Exchange Commission’s to ensure they have the available funds to make these transactions.
Whatever the route you decide to take, make sure you have all of your forecasts, personal financial records, research and business plans in top-notch condition at all times.