8 Places to Fund Your Business
If you are wondering about how to get funds to start a business, there are a few different methods you can try. Specifically we have found eight which may be of help to the beginning entrepreneur. Among these are the yard sale, online sales, grants, the SBA, friends and family, working in the field, credit, and selling share of the business.
Using yard sales when you are looking at how to get funds to start a business can be done in two ways. You can either pile up everything you don’t use daily and sell it, which is the simpler method; or you can go to yard sales, pick up a few good deals, and then sell those at flea markets for a slight markup which requires a bit more work.
As an alternative to the above method of how to get funds to start a business, you can also sell items on sites such as Craigslist.com, Etsy.com, or eBay.com. Craigslist is a community site, while Etsy sells hand crafted items and eBay is an auction site. Depending on what you are trying to sell, each site has both advantages and disadvantages. You can also find sellers of bulk amounts of items online which you can buy and then resell as smaller lots for a higher price.
Friends and Family
This is another way of how to get funds to start a business. While many people don’t like doing it this way, there is a way around the potential pitfalls. Write up a business plan as you would for a lender; then present your proposal to them. If you are comfortable with the idea, offer a small share of the business or a percentage of the profits once the business begins to make money in return for their investment.
First I want to tell you that you do not have to pay for this information. By doing your own research either online or via the library you can easily find organizations, foundations and government agencies which will provide grants to certain groups of people. Locate about ten and write your proposal for each. Make sure you follow their instructions for each application. You will need a business plan for these.
The Small Business Administration offers a good variety of programs and services to someone looking to start a business. Usually the SBA will offer to guarantee a loan to the bank if you qualify. Again you must have some funds to invest and a business plan to show you are serious and have thought the idea to completion. Work for a business in your field by working for someone already in the business gives you many advantages about finding out how to get funds to start a business. While you will earn a paycheck, you will also gain valuable experience from someone already in the industry. You will also gain first-hand knowledge of every aspect of the job from the ground up. This will also help in getting any bank or SBA money as they will see that you are already gaining experience in how the business should work. You might even get a small loan or advance from your boss to help start on your way. I have seen pizza shops start this way. In fact, both Domino’s Pizza and McDonalds used to insist that new franchisees work for another franchise before applying for their own store.
Depending on how much control you are willing to give up, this could be a very good way to raise funds for your business. If you incorporate, you can sell shares for as low as a penny to raise capital for equipment and initial funding. There is a good deal of regulation which goes with this method so you should do some research before going this route.
Use Your Credit
Notice that this method of how to get funds to start a business is last on the list. This is because this is the last method you should try to use if all else fails, including all of the above. I have seen people use their credit cards to fund a business, and this can be done; but the interest you pay on the initial money means that you are paying up to three times to start your business.
Image Credit W.A. Swan