Startup businesses are expensive to operate, especially when you’ve outgrown your initial outfit and need to expand. According to Fundsquire, 60% of startups go bust within the first three years of business, meaning you need to plan properly and secure funding by any means. Throughout this article, we will cover a series of options available to you, and the rest is down to you.
Call on Family and Friends
Nobody likes asking their family and friends for money, but sometimes it’s the only option. Approach this how you would anyone else and lay down all of the facts for them, which shows that you’ve carried out your research. Express that the funding is a loan and tell them exactly how much they will get back; offering interest will help sweeten the deal.
Explore Venture Capital
Venture capital is extremely popular for tech startups because it’s much more than simple funding. For example, Parabellum Investments relies on growth for its portfolio to work, which means it will support your business and help point you in the right direction. However, as it will have a large share of the business, you will likely need to forfeit some of your control, which is a necessary means to an end.
If you’ve only just launched your startup, bootstrapping might be the only option available to you at first. This means funding the company from your own pocket, typically through selling possessions and completing small projects for cash. Then, when the business has launched, you rely on initial income to succeed. Bootstrapping isn’t a long-term fix, but it can buy you more time to secure investment.
Once you have a solid product on your hands with strong initial interest, you can do extremely well sourcing funding through crowdfunding, which involves turning to the public for donations. Typically, businesses will encourage donations by offering shares in return or free versions of their product.
To do well with crowdfunding, it will help to get yourself on social media, which will help you generate more interest. If you can, reach out to an influencer in your niche and have them recommend your product – a simple plea from an influencer can be enough to skyrocket your campaign.
If your business has been operational for the required length of time, you may be eligible for a business loan. However, you need to demonstrate that you have excellent credit so far, which means not being in existing debt to any party to your business.
The government offers various funding schemes depending on the needs of the country. For example, if your business is developing the technologies of tomorrow, you can your hands on a portion of a sizable pot of £743.5 million.
When startup businesses grow, they call for money to build up their infrastructures to meet higher demand. There are several different ways to secure funding, and the list above will point you in the right direction.