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How to Source Funding for your Startup

 

Whether it’s a cool new app or a new fancy restaurant, more often than not it will require source funding in its early days

 

Small businesses are said to be the “backbone of the economy these days”, which has lead to growing opportunities for entrepreneurs to take their powerful ideas and bring them to life. However, these opportunities rarely present themselves without careful timing and consideration. Whether it’s a cool new app or a new fancy restaurant, more often than not it will require source funding in its early days.

While coming up with a business idea that you actually believe has potential is one thing, finding the opportunities available to fuel it is another – something entrepreneurs sometimes struggle. For an entrepreneur starting out, it can be difficult to source investors for your business idea, but if you leverage the various sources readily available through the internet, your new business venture can receive the funding it needs to get it “up and running.”

Below are six things to consider when looking for investment options for your startup:

Source funding - K2 Analytics

Bootstrapping

Many entrepreneurs attempt to finance their new company by “bootstrapping” – which includes gathering any personal funds available to them from savings accounts to credit cards to home equity lines in some cases. The benefit of bootstrapping is that you won’t have to face monthly payments. However, it can be quite limiting, depending on the type of business. If you are looking to get your business off the ground quickly without putting your personal funds on the line, it may be advantageous to extend your search to an outside source of funding.

 

Crowd Funding

Crowd-funding sites are increasingly growing in popularity. Sites such as Kickstarter allow entrepreneurs to set a funding goal and deadline and raise funds from small global supporters across the web. If your project is successful, Kickstarter will take a fee, however, if it is not successful, there are no fees involved!

Get a Loan

There are many options to consider if you are opting to try and secure a loan. Be sure to have as many details as possible about your business, including your financial details to date and how the loaned money will be used and repaid.

Find an Angel Investor

Primarily, angel investors always look for new great ideas from entrepreneurs, in return for a portion of their company. Shows like CNBC’s Shark Tank is a prime example of this. If you are comfortable exchanging equity for financing then finding an angel investor may be a good option for you.

Apply for a Grant

If money is provided to you free or charge to get your startup off the ground, you’re not going to complain, right? Although grants are difficult to come by and are dependent on the type of business, there is no harm in looking. Put together an extensive proposal containing particular aspects of your new business venture and start applying. 

Enter a Contest

Many large companies these days are encouraging and increasingly supporting small business start-ups by holding contests and offering a substantial financial reward. Conduct a search online and on social media of ongoing contents that suit your business’ theme and pitch it in a way that ensures your idea stands out from the crowd.