Having a potentially world-changing idea but not having the finances to fund it is a frustrating thing. Unfortunately, for many young entrepreneurs, this is a common occurrence. How will your innovative phone app or beach-themed bar come to fruition if you don’t have the cash to make it happen?
If you are savvy and determined enough to go the extra mile, you’ll find that there are ways of financing your business idea without a bank full of savings. Here is how.
Sell Your Old Stuff
Many people sit on items that are worth far more than they know. You might have a card collection collecting dust in your attic that sells for hundreds of pounds or a couple of old technology pieces that could give you a head start after selling them online. If you have an old car, why not look at scrapping a car in Essex for an extra cash injection? When looking for ways to raise money for your business, remember to go through your unwanted items to sell them for a good price.
Start a Crowdfund
Crowdfunding is a great way to raise money for a business, but it takes more than a little effort to see the money flow in. To get people interested, you must create an online platform and learn how to sell your idea. The first step is to get your friends and family to share your crowdfunding posts online, and from there, aim to reach a wider audience. The benefit isn’t just having the funds to start your business – it’s also the exposure you receive from it.
If you have an amazing idea for a business that’ll change the world, but it needs more financing than the average online store, why not pursue a more affordable side hustle to get you started? While you earn on the side, you can work on your larger ideas in your free time while saving up the money to make them happen. Plus, you’ll gain essential business-running experience that’ll help you avoid mistakes in the future.
Get a Business Loan
Getting a business loan seems like the obvious choice when financing a business, but it’s not as simple as applying and then receiving a large cheque in the post – you must first qualify for the loan. A couple of things to consider when applying for the loan include your credit score, how much money you currently make, and how much business experience you have.
Another factor that lenders consider is how well thought out the business plan is. Before jumping into an application, you must take your time creating a plan that isn’t just exciting but is also feasible and realistic. Your goal is to convince the lenders that your business is worthy of a loan.
Ask Friends and Family
This isn’t something everyone has the privilege of being able to do, but if you have friends and family who have money to spare, then consider asking them if they want to invest in your company. More often than not, this is how business owners find investors in the early days. Even a little cash injected from a family member can help get the business off the ground.
As a young person, you probably have already experienced living cheaply, especially if you’ve been a student. If you want to finance your business quickly, cutting down on expenses and living frugally will help you get there. That means meal planning and prepping, saying no to expensive plans, stopping yourself splurging on material items, and lowering your gas and electric bill. It might be challenging at first, but if you’re passionate about your business idea, it’ll be more than worth it in the end.
Look for Investors
An investor is one of the best ways to get your business off the ground, as not only does it help finance the initial costs, but it also shows that another business-savvy individual believes in your idea. Your primary focus should be Angel Investors who provide a large sum of money to aid in getting your business off the ground. It’s generally better to go with a couple of large investors rather than multiple smaller ones, as communicating with too many investors might end up confusing and time-consuming.
Much like applying for a business loan, finding great investors requires a solid business plan. By having a solid plan that makes sense, investors are far more likely to consider giving their time and money.
If you have the passion and drive to give your business idea everything you have, then you’ll find a way to jump over financial obstacles.