How have you financed the starting up of your small business?
To help potential entrepreneurs with financing their startup, we asked small businesses owners and business leaders this question for their best insights. From getting a loan to leverage crowdfunding platforms, there are several options to help finance your small business startup.
Here are eight ways to finance a startup small business:
- Research All Possible Options
- Use Profit from a Previous Venture
- Build a Conservative Business Plan
- Leverage Crowdfunding Platforms
- Utilize Personal Savings
- Keeping Expenses Low
- Getting a Bank Loan
- Look for Investors
Research all Possible Options
Financing a small business can be especially challenging. But depending on your location, industry, and of course product and services, there may be various opportunities for funding. Some countries or states offer funding programs for the development of certain industries. Many startups take advantage of online crowdfunding platforms, angel investors, and venture capitalists.
Guy Katabi, Lightkey
Use Profit from a Previous Venture
Before I started The Lash Professional, I had The Lash & Sugar Company, which is the lash extension salon I founded. I successfully launched that lash extension business and scaled it to three locations by staying competitive. Using profit from my lash extension business, I was able to begin my online company, where I offer professional lash supplies and training. It’s been so rewarding to share my passion for lashes with other women who want to be their own boss. That’s why I share my 12 years of business expertise through my Lash Business Course.
Vanessa Molica, The Lash Professional
Build a Conservative Business Plan
I have done this twice in my career, both for printing industry businesses. Decades ago, I founded my first venture and used some personal and family capital. We were lucky and disciplined enough to “buy out” the family-based funds over time. Over the years, we have also developed an important relationship with our banker who I can always count on. The key to the successful financing of a business is to have a conservative business plan and to be disciplined and realize that profit is what makes a business grow and be successful. Research equipment and other large capital projects to be sure they are justified. You also have to say “no” sometimes, and that is part of being a successful businessperson.
Eric Blumenthal, ZoePrint
Leverage Crowdfunding Platforms
Look beyond big banks and traditional lenders to find alternative sources of business funding. Crowdfunding platforms allow you to present your business to the masses and garner financial support from hopeful investors. From Fundly to Kickstarter to SeedInvest and more, there are many options out there for entrepreneurs to take advantage of. In order to enhance chances of crowdfunding success, generate buzz about the business on social platforms prior to the campaign.
Claire Routh, Markitors
Utilized Personal Savings
I used personal money to start my LLC. The money was in my savings and was not designated for a particular purpose. The initial funds were specifically used to open my business checking account. This makes it easier to identify which purchases are business-related when tax season comes around.
Annette Harris, Harris Financial Coaching
Keeping Expenses Low
I started my small business by taking out a small loan and keeping overhead costs low. I rented a very small office for a very reasonable price, purchased a refurbished desktop computer, used my home printer at my office, and found any other way possible to cut costs. Once I started to generate some revenue I then began to invest into my company so that it could grow.
Tate Meagher, Meagher Law Office, PLLC
Getting a Bank Loan
There are many steps involved in small business financing. First, make sure your credit is strong. Next, go to the bank. Be prepared to give collateral for any money they give you. This might include your house, the business’s machinery, or your future income. The bank will want security that they will be paid back.
Janice Wald, Mostly Blogging Academy
Look For Investors
Look into investors. There are many different platforms to post your business story and people can invest and fund the startup. It usually has a fast turnaround to reach financial goals. Do some research into different platforms and get set up for investors to learn about your small business.
Olivia Young, Conscious Items