As an entrepreneur, one of the biggest challenges you may face is raising money for your business. While money doesn’t grow like grass, there are a number of ways you can develop money for your business.
I have created a list of ways you can raise money for your business.
This is one of the best ways to raise money for your business. Nobody can invest in you and your idea the way you would. The first step is to start from your little savings, no matter how little your earnings are, try to save a reasonable amount for your business. With this, it makes it easier for you to be able to convince friends and family to loan you money for that business idea or plan that you have. No matter how much money you earn at the moment, try your very best to set something aside for your growing business.
Try to narrow your list down to asking family and friends that are invested in watching you grow and succeed. Focus on those who are ready to make sacrifices to see you thrive. You can also encourage them by having a solid business plan and direction. Also, be realistic about how much money is needed.
Lastly, make sure to agree on what form they would lend you money. This could be a loan or equity in your company. If it is a loan, agree on a repayment plan and ensure you pay up as at when due. Make sure everything is documented to avoid issues in the future.
Crowdfunding allows you to connect with like-minded people who you would not be able to engage with on a normal day. You can review your product and understand what resonates with people and what doesn’t. This shows you how to improve your product and your pitch. Most importantly, crowdfunding can help you raise money to fund your business.
So, how do you launch a successful crowdfunding campaign to raise capital for your business? Nathan Resnick, a serial entrepreneur who has had success raising money on crowdfunding sites, stresses that you must develop your story, as “people on crowdfunding sites like Kickstarter or Indiegogo want to know how you turned your idea into a reality.”
You should also have a video pitch that shows the value of your product, the need it serves, and why you require support. In doing this, it is best you have a good website and PR outreach.
An angel investor is typically someone who has a lot of money and is willing to invest in your business in return for an ownership stake. They look for a high return investment. Therefore they can go any length to invest in a business that would yield returns. They are mostly, experienced entrepreneurs who have become wealthy from the businesses they own but are keen on investing in new startup businesses as a way of helping the next generation of entrepreneurs.
Angel investors are a good source of capital for your business. But first, you must have a solid business plan put together and a pitch to capture their attention. You must have data about your company’s current situation and future potential. You may be wondering how you find angel investors. This might seem difficult, but many resources exist. Here is a list of angel investors in Nigeria.
Governments and agencies are interested in supporting small businesses because of the important role they play in the economy. Small businesses are known for generating a lot of employment, improving technology, and producing products and services. Due to this, government institutions and international organizations set up grants and loans to support small and medium scale businesses in Africa. From history, it appears that many people do not know about these opportunities or even bother to send in their applications. Applications are usually free and will cost you nothing. Why not give it a try? You’ve got everything to gain if it works out! Just make sure you go through the guidelines and comply with them.