4 Shockingly Overlooked Ways of Raising Capital to Start a Business
One of the toughest hurdles most entrepreneurs face is raising capital for a business. Most times, people come up with great, viable business ideas, but they lack the required capital to kick-start this idea soon it dies a slow death.
If you have a good business idea and have drafted the corresponding, well-analyzed business plan for your idea, raising capital for business need not be an issue as there are quite a few highly overlooked ways you can employ to get the funding you need, and fast too.
Here are Six Ways of Raising Capital to Start a Business Either in the Form of Grants or Low Interest Loans
One of the best ways of raising capital to start a business is by going through business mentors.
Business mentors are great for your business, not just because they are likely to provide your business start-up finance, but also because they also bring a wealth of experience and mentorship on board.
This set of individuals have been in the business long enough to know what works and what doesn’t and becoming their mentee will save you a whole lot of mistakes, wasted time, stress, as well as possibly provided the start-up fund you need.
You should, however, know that there are two types of mentors:
- The ones who provide mentorship for free
- The ones who do so as a paid service.
You should also know that not all business mentors provide loan/grant capital to their mentors, so be sure of what’s on offer before choosing someone as your mentor.
Here are two places online you can find business mentors for free.
- Micro Mentor
- Score Mentor
Also note that mentors usually are not so outspoken about their desire to mentor others and meeting this set of mentors usually happens through a mutual contact.
You can get a mentor from around you. Let people know you seek a mentor to hasten getting one.
2.Crowd Funding Websites
Another good means of raising capital for business is by going the route of crowdfunding.
Crowdfunding as a means of raising cash first came about in 1997 when a British rock band, Marillion was able to raise $60,000 from fans for their US tour.
This method of raising capital for business has since grown in popularity as more and more people are turning to it.
In 2012, about $2.7 billion dollars was raised in over a million individual campaigns and in 2015, $34 billion was raised in similar campaigns.
It is expected that this figure will continue to increase as more people turn to crowdfunding to raise money for their cause.
Here is a list of some of the crowd funding platforms you should checkout:
3.Piggy Bank Savings
This is one of the ways of raising capital to start a business is as unconventional as they come and consequently, a lot of people overlook it. However, this seemingly unimportant saving method/medium has raised a lot of emergency cash, not just for kids but adults as well.
Recently, a young lady raised over 700,000 naira ($1,944) using a locally made piggy bank within the space of a few months.
The beauty of using piggy banks in raising capital for business is that it can be done in bits or at your pace as the money becomes available so you don’t get put under any kind of pressure. However, it is important that add that using piggybank to raise capital requires a lot of discipline so you don’t break it before the goal is reached.
Piggy banks can be gotten locally from around you or online in shops that stock them.
There are also a few companies or brands that operate this system and you might want to sign up with them. The way it works, you automate the process and each month, a certain amount of money (as stipulated by you) is transferred out of your account into your piggy bank savings account. This is done monthly until the goal is reached
Suppliers credit involves getting a manufacturer or supplier to provide your business with the needed goods on credit. Once gotten, you sell the goods and return the cost price to the manufacturer minus the profit.
This method is seldom used as it requires a lot of truth between the parties involved, especially if they were previously unknown.
However, it remains one of the best and stress-free ways of raising capital for business as you don’t particularly look for capital but instead, look to build trusting relationships with your target manufacturers.
These are four of the best ways of raising capital to start a business and quite a number of people have tried one or two with very good results to tell.
Tags: how to raise capital for business, ways of raising capital to start a business, business capital, raising capital for business