How To Fund Your Business Idea

Trying to start a business without having capital has stopped many women from realizing their dreams of being entrepreneurs but no worries; this article highlights ways to fund your business.

However, there are other ways of raising funds to start your small business without even seeking to get a loan.

With the state of the economy and the constant menace of unemployment, starting your own business would save you from idleness, make you your boss, and, with time, make you an employer of labor.

If you do not have collateral to get a loan, here is how to fund your business idea.

1. Personal savings

Nobody will invest in you if you are not willing to invest in yourself. No matter how little it may be, save up some cash on your own before seeking other sources. People tend to be more willing to help those who take that first step.

2. Friends and Family

This is the second-best way to raise funds for your business. You might never know how much your friends and family can help you achieve your business dreams until you approach them. Cast your pride aside and ask for help when you need it and you might just save yourself a lot of stress.

3. Crowdfunding

Outside of getting financial assistance from your friends and family members, a crowdfunding account such as GoFundMe is a good place to solicit support. If your project is convincing enough, there are still kindhearted people who will be willing to part with their money to help you.

4. Angel Investors

There are lots of business-minded people who are ready to fund start-ups as long as you are willing to part with some equity. Draw up a proposal that clearly states what you want to do, how you want to do it, and what you will need to do it. These investors could even be family friends or people who you relate to through different organizations.

5. Small business grants

This is a type of fund given by the government or some other privately owned organization to individuals who want to start businesses but do not have sufficient capital. For most of these organizations, you only require a strong passion to succeed, a willingness to help others, and a good plan. Organizations like these in Nigeria include the Tony Elumelu Entrepreneurship Program, Africa’s Young Entrepreneurs Empowerment Nigeria (AYEEN), and the Dangote Foundation.

6. Seek venture capital

Finding a venture capitalist who shares your vision, or at the very least believes in your ability to turn your idea into a successful, profitable venture, is a good way to raise cash. Of course, you will need a fine-tuned business model, ideally one that’s ready to scale. The main con with this option is that venture capitalists are typically looking for the next big thing, and so many entrepreneurs struggle to convey the scaleability of their enterprise. Venture capital funds, by their very nature, have a short shelf life as they generally seek to recover their investment, turn a profit, and then move on to the next fresh start-up.