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Whether you’re setting up a new business or planning to make a new investment – in order to make it happen you’re going to require capital and raising investment funds can be a monumental task if you don’t know where to start. There are, however, a wealth of options on the table if you’re willing to cast the net out and look for them. The real art is in finding the ones that work for you.
Bootstrapping
This refers to using your own personal savings to support the investment. Of course, by bootstrapping your business it’s unlikely you’ll be able to make a substantial investment, but the primary benefit is that you are risking less and you don’t need to borrow anything or sell any equity.
Crowdfunding
Crowdfunding is a very modern but potentially profitable way to raise funds for a small business launch and there are many success stories going back as far as 2013, with affordable 3D printer makers Formlabs raising $3 million in capital on Kickstarter. The benefit of crowdfunding is that it gives you a direct line to your funders, who could come from almost any walk of life. The idea is to offer rewards for backers, which could be anything from a finished product to something more obtuse – like a special mention.
Business Loan
If the ROI of a promises to be high (greater than the cost of the loan) and the risk level of the investment is relatively low, then you might be able to take out a business loan for a quick turnaround. A company such as Liberis should be able to offer you a small business loan to help gather the funds for this once-in-a-lifetime investment and can offer you that loan at once fixed cost with no APR. The Small Business Administration has found that almost three-quarters of new businesses are started on the back of loans, so you’d be in good company.
Social Media
Whether it’s LinkedIn, Facebook or even Instagram, don’t neglect your social media friends and followers as many of them might be more than willing to help with your business or investment. It can be a wonderful way to gain traction and is very cost-effective. Most social media platforms also allow for direct messaging, which is a fantastic way to get directly in touch with angel investors, such as the top 50 recently listed by Forbes.
Friends and Family
If all else fails, most young investors or SME owners will have friends and family members they can turn to for help. Indeed, the Global Entrepreneurship Monitor states that 5% of US adults have invested in a company started by someone they know. So, don’t feel bad asking your loved ones for help, but also, don’t be surprised when you are expected to return the favour a few years down the line!
