5 Fund Raising Ideas For Small Businesses [Friday Five]
Although there are many opportunities for small businesses to raise capital, you should realize that many of the choices for a growing business may not always be available. This is why you need to be able to take an advantage of an offer immediately when it presents itself.
Here are five of the more popular solutions that are used by small businesses today to help raise capital:
1) Business accelerator programs
These special programs for businesses exchange capital investment for shares of equity in the companies that participate. For a company to qualify for one of these events, which generally last for about 12 weeks or so, it must have a team and not be merely one or two individuals working together. The logic for this condition is that there is simply too much work involved with running a legitimate business, and it takes a competent team of individuals working together in order to make things work properly.
Another one of the bonuses from these programs, is the fact that it is possible to gain important insights which you as a business owner may not be aware of. This is due to the influx of new perspective which is received from the all of the various entities, or “stakeholders” that are now closely examining your situation.
A business presents its ideas to the world and then the public at large is encouraged to provide funds for this new idea. This type of platform has been successful for many organizations over the years, and the two most critical components needed are a truly revolutionary idea and/or product as well as a convincing video. These campaigns have worked for all types of goods and services, including tech gadgets, online wills, electronic games, and more. The two most popular crowdfunding websites are Kickstarter and Indiegogo.
3) Business plan competitions
Participate in business plan competitions. In order to qualify, one must have to have a business plan because this single element is one of the core components of a successful corporation. These contests allow for a company to contemplate the components of its business plan in ways never considered before. This is primarily because the ideas of a business are examined by numerous entities from a lot of angles, which provide an organization with many unexamined viewpoints about important situations.
It is always a possibility for a company to get financing from a bank. Even if a business is not yet ready for a such an arrangement with a financial institution when it is starting, it could be in a better position to get a loan once it has been in business and has a consistent cash flow that would be better able to handle such an arrangement.
5) Family and friends
The inner circle of a company’s most important members often proves to be one of the best sources of finding capital for a large number of small businesses. It should always be remembered that this may also be a convenient and practical resource to network.
So in conclusion, not all of these options will work for everybody. This having been said, consideration of a few of them may cause new creative ideas to develop. This is why it is important for the individuals in any organization to always keep an open mind about all of the various possibilities so that their small business may ultimately succeed.
Did you use one of these fund raising methods when starting your business? What advice would you share with entrepreneurs looking to raise capital for their new business venture?