Last Updated: December 16th, 2022
Do you have a business plan and are worried about raising funds for the same? It’s a bitter fact that nobody is there to throw money at you because of having a business plan. However, there are lots of extremely creative ways to funding startup with ease and let it go up to the zenith of success. The article explains all such easy-to-handle techniques without feeling any hassle during the time. You may also want to try these best VoIP Phone Services For Your Business and health insurance for small businesses.
Funding Ideas For Your Startup
1. Small Business Loans
There are some banks offering loans to small businesses or startups. However, they deeply analyze and understand the working functionality before providing the same. It is sometimes difficult to qualify for new startup businesses.
Alternatively, there exist lending companies with little bit formalities as compared to the earlier one. Based on the workflow protocols and essentialities, you can better judge the medium to request business loans.
2. Trade equity or services to request business loans
This option is synonymous with bartering the skill sets or something you have for your necessities. We can consider an example of negotiating free space for the official works accepting the rules to support the computer systems for all the concerned office staff.
Another associated example is the exchange of equity for entire accounting and legal support systems. There exist some downsides with trade equity or services. Appropriate analysis of the concerned service provider is essential, along with successful customer feedback.
3. Crowdfunding
Crowdfunding is an activity to raise money from the crowd in the form of equity, debt, or donation. Websites like Kickstarter and social media are utilized for advertising the campaign for getting the maximum out of it.
The crowdfunding platform gets an idea of the complete description of the business. Moreover, the business plans, along with the goals, are put forward to let the business stand uniquely as compared to the others.
This activity works out the best for funding your startup as it is capable of successfully removing brokers and startups by putting the funds in ordinary people’s control.
4. Bootstrapping
Bootstrapping is another excellent way to fund your startup and more than 80 percent of startups do Bootstrap. In Bootstrapping, business owners use funds from their savings, mortgaging homes, or from low-interest business credit cards.
The plan is vital for first-time business owners owing to the provided flexibility. There is no requirement for the paper works and other formalities, making it convenient for implementing without any issues.
The result comes out positive in the maximum percentage of cases. The reason is understood because you invest your own hard-earned money and accordingly give out your best.
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5. Angel Investment
The funds in the case of Angel investment are invested in exchange for the equity proprietorship of the concerned businesses. You need to go ahead with the appropriate investor, prepare the pitch for the venture, and negotiate the terms of investment for long-term benefits. In Angel Investment you don’t have the obligation to repay the amount funded to the Angel Investors in case of business failure.
Out of the total equity, the ownership percentage can be 10%-50% resulting in the best business benefits in the forthcoming years without any special conditions.
The top-rated angel investment organizations in India are:-
· Chennai Angels.
· Mumbai Angels.
· India Angel Network.
· Venture Catalysts.
· Lead Angels Network.
· Calcutta Angels.
· Hyderabad Angels, etc., to name a few.
6. Venture Capital
Venture capitalists invest in these funds for selecting the companies for investment based on returns and growth. Such forms of investment are automatically complete whenever the business enters the IPO stage.
The funds are suitable for businesses beyond the startup phase with a strong operating team and excellent traction. The companies taking years of a period to get inside the market never match the protocols of venture capital. The compatible investors meet the criteria and accordingly prefer to select the investment in the form of venture capital to go ahead with the business smoothly.
7. NBFC Loans
NBFC is another alternative to funding your startup with the eligible set of conditions. Like the other loans, under the defined timeframe, you are required to pay the amount back along with the calculated rate of interest.
The most significant advantage is the least rate of interest along with the provision of microfinance institutes. Compared to conventional banking, the sanctioning loan process is a little bit troublesome but added set of benefits is available without any doubts.
8. Government Programs
The government programs are launched at regular intervals to fund startups with easy terms and conditions. MUDRA loan is one among those offering investors a versatile range of financial independencies.
The investors or business individuals can elect to select from three different associated alternatives, including Shishu, Kishore, and Tarun.
Also, there are several schemes launched in the state for supporting the growing startup ideas. These include Maharashtra Center for Entrepreneurship Development, Rajasthan Startup Fest, Kerala State Self-Entrepreneur Development Mission, and several others.
9. Bank Loans
Bank loans can be of two different types to let your startup function without any financial deficiencies. These can be in the form of Capital Loans and Funds.
Capital loans are the kind of loans essential to executing one complete cycle of revenue-generating operations. Mutual understanding is made with the consent of the investor as well as the bank.
In the case of Funds, you need to share the B-plan and the details of the valuation. It includes the involvement of project reports and others as well.
The list of banks issuing such a form of loan includes HDFC Bank, ICICI Bank, Axis Bank, Bank of Baroda, etc.
To sum up, these can be the essential mediums to fund a startup and raise your business to a professional level. You can go ahead by selecting the appropriate investment mediums to move all along the sky of business and host the flag of success.
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