Starting a business has become a huge trend in recent years. People are starting to break away from the grind of large businesses and forge their own paths. And more power to them! It is proven that local economies thrive when boosted by a large number of small, independent businesses.
But starting a business isn’t easy. In fact, it is one of the most stressful and difficult things a person can do. It requires dedication, hard work, and, most importantly, start-up capital. Money makes the world go round and not everyone can afford to pack in their job and invest in a business. If this is you then you might be disheartened. But there are actually plenty of ways you can find the funds to start your own business. Today we are going to walk you through a few different methods.
Securing a Loan
The simplest and most effective method of starting a business is securing a New Business Loan. Most big banks offer this and will often be quite competitive with each other in hopes of bringing in potential customers. So if you do decide to go down this route we suggest you shop around. Talk to a few banks and note down what they are offering. Make note of the interest rates and repayment plans. Ideally, you want a low-interest rate to ensure you aren’t going to go bankrupt from loan repayments.
You will need to consider the ramifications of taking out a loan of course. Debt is not a small matter. You will most likely be carrying that debt for a long time unless your business becomes an overnight success which isn’t very likely.
Get a Business Credit Card
Credit cards are a fantastic tool for starting up a business. Often you will need to buy things you simply can’t afford to pay for outright. Equipment, stock, paying wages. But a credit card allows you to take on debt that can be repaid later once your business starts bringing in a profit.
Getting a business credit card is a fairly simple process. You simply contact a company, like Capitalone, and apply. Then you need to wait for them to send you a request letter with a reservation number on it. After that, you just have to go to their site and use your capital one reservation number to start the application process and once that’s done you’ll have your new business credit card.
Keep in mind you can rack up a fair amount of debt using a credit card so make sure you monitor your spending carefully and keep your purchases focused on things you need for your business.
Seeking Private Investment
This is another extremely useful method of securing funds for your new business. Unlike a loan from a bank, private investors often take a stake in your business rather than traditional repayment. This means they will be entitled to a share of the total profits of the business.
There are lots of ways to go about this. You could attend an investment expo. This is where businesses set up a stall and potential investors walk around trying to find businesses to invest in. You could also use word of mouth. Talk to other local businesses and see if they know of any potential investors. You might even consider going on an investment TV show like Dragons Den or Shark Tank. This can be quite a daunting experience but gives you a chance to secure that much-needed investment and will teach you a lot about the investment process.