If for any reason you find yourself on the rutted
path to entrepreneurship make it an obligation to
keep reexamining yourself to be sure you are
combat ready. Behold, the first hurdle; raising
adequate funds for your startup.
Finance as a subject remains most vital even to
the blue chip organizations. A lot of times it even
comes easier for already established and excelling
businesses. We keep hearing stories of how
financial houses and some private investors keep
persuading ace entrepreneurs and multinationals
with unsolicited funds. For you as a start-up
entrepreneur -you have to fight your own
battle.
Don’t fidget,... read on..
it’s not outlandish if banks, venture capitalists or
the government are not showing you any support
everybody want to know exactly how much of your
own money you put into it. And most other times,
no matter how creative or promising your start-up
may be, some investors still want to see it work
first before becoming a part of it- probably when
you need them no more.
Nevertheless, you might be surprised about how
much you can achieve starting out on your own.
First step: look inward, list the facilities you own
already probably some can be useful for your new
venture or can be converted to cash. Eg tools,
vehicle, assets or even your apartment which can
be used as your startup office etc., even your tap
water). Shiekh Muhammed bin Rashid resolved to
the construction of Burj Al Arab (known as the
world most luxurious hotel) when the government
thought of the future of the United Arab Emirates
without crude oil which the country presently thrive
on. The natural resources they discovered they
had left were; sun, sand and sea- hence
diversification into tourism.
PERSONAL FINANCING: I don’t care if you are or
thin, you most likely have to be ready for a dieting
program. Some good part of your savings have to
be dug out to put into your start-up, if you are not
ready to sacrifice and stand for what you believe
in, then who else should?
OVER DRAFT AND PERSONAL CREDIT LINES:
Depending on type of account you run with your
bank, your account balance and activities, some
banks might give you the benefit to make
withdrawal beyond your balance for the sake of
financing your start-up. The advantage is that you
retain total ownership and control of your business.
FAMILY AND FRIENDS: In a country as ours
where family ties are highly respected, looking
around for friends and relative who believe in you
to make initial investment in your business is most
likely one of the best bet of getting financed.
Dangote and a lot of others in his category got
such hands.
CROWD FUNDING: Here you use the power of the
Internet or association to get a large amount of
people with like-minds with small amounts each to
back your efforts.
MICROLOANS: These days there are many
companies and microfinance banks run by private
corporate organisations. A lot of starting up
entrepreneurs seems not well informed yet about
opportunities such organizations offer. Some
merely demand that you have a savings account
which them and after a period of time you can
access loan in multiple of a particular percentage
of your account balance, without collaterals.
VENDOR FINANCING: If there are particular goods
or material you require for your production, some
manufacturers/ suppliers can be convinced to
defer payment until your products are sold.
PURCHASE ORDER FINANCING: The availability of
a legal purchase order for your start-up to supply
or render certain goods/service will a lot of time
make it easier for you to access funds without
collateral or much interest.
PARTNERSHIP: Working along with someone who
has an interest in the business with a certain
amount of money to finance it is also ideal. Such
person could be a friend or just someone with a
like-mind. This way percentage of each person’s
ownership in the business is always noted.
LAUNCHING/FUND RAISER; being creative
enough on the debut of your product or business
you may send out request letters for fund raiser or
host a launching event where necessary people
will be invited to support your dream.
PRESALES ORDER: this is when you persuade
your clients/ customers to pay ahead before
goods/ services are being delivered.
GOVERNMENT GRANTS: Government of various
nations having noted that entrepreneurship is
pivotal to economic growth- make provisions
through certain bodies to give grants to
entrepreneurs with ideas considered worthy.
NGO GRANTS: A lot privately owned Non-
governmental organizations exist all around the
world with a focus on aiding entrepreneurship.
Finding out nearest ones that might consider you
legible should be your first task.
HIRE PURCHASE: instead of cash finance, some
equipments or needs for your start-up can be met
through hire purchase from the sellers, in this way
they still have legal possession of such equipment
till payment is completed.
LAUNCHING A BUSINESS ON THE SIDE. Doing
side businesses such as sales of petty items etc.
With the little amount you have on you till you get
enough funds isn’t also a bad idea to raise funds.
VENTURE CAPITALIST AND PRIVATE INVESTORS:
good networking is highly necessary for your new
business to succeed. Venture capitalist are
organizations or individuals who are business
inclined and have funds always ready to give out to
new businesses on agreed terms of share owning
or loan, depending on how credible the is seen.
GET MOBILE: Endeavour to get mobile if your
business or service is such that you can start
reaching out to service clients and deliver
products if you don’t have enough stock or a
space solely for your business yet.
ONLINE SPACE: These days a lot of money making
ventures are online, some may have never really
intended to be exclusive on the web, but
considering the cost of rent of property and the
attending cost of maintenance and staffs –they
start up online and make enough profit to expand.
BREAK DOWN OPERATIONS : for instance starting
up a clothing line and you don’t have enough
capital you could start up by breaking down your
operations by starting up with offering advisory
service, fabric selling... till you eventually get into
full business
I.R.A FINANCING: If at the moment you have a
paid employment in most cases you should
reserve an Investment Retirement Account for you.
This can also be a good source to fund.
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