Raising Capital in The Early Days

Raising capital in the early days of your business can be a challenging task, yet it’s fundamental to your future success and growth, as it is like rocket fuel – meaning the business isn’t going to get very far without enough fuel.
In a similar vein, your business won’t get far without a decent business model, and in this sense you can visit sites like www.bpmonline.com/bpm-software to get assistance with business process modelling which can be very helpful when it comes to pitching to investors, or even friends and family.
Essentially, raising capital to start a business isn’t usually something people look forward to, as a process – they look forward to the end result, but the process of raising capital can be daunting.
If you’re just starting out there’s a good chance you are finding yourself in the somewhat frustrating position of needing money in order to generate revenue and be profitable.  You might feel you are sitting on a goldmine, but fear that someone else is going to implement your idea before you have chance, and therefore, a lot of entrepreneurs can feel quite desperate in the early days in terms of raising capital.
The one thing that makes entrepreneurs stand out from the crowd, however, is their determination to succeed.  Where there’s a will there’s a way, and when it comes to raising capital in the early days, it’s often about knocking on as many doors as possible, having a few slammed in your face but not losing enthusiasm, and keeping on knocking.
This article considers three of the most simple ways you can fund your early stage business that are accessible and relevant for most people looking to raise capital:

1. GET A BUSINESS LOAN

The most obvious and perhaps traditional route for funding your business is to get a small business loan.  That said, not everyone is in the financial position to obtain a loan, no matter how good their idea might be – as banks often require security in terms of putting the loan against a property or other asset.
This is particularly challenging for young entrepreneurs, or those with an adverse financial history, or simply “entrepreneurs” in general – as banks tend to lend money only to people they know will pay it back… and in this sense, the person with a mortgage and a regular job is a safe bet.  Entrepreneur’s, on the other hand, are as risky as they come – from a bank’s perspective.

2. INVESTOR

You will have likely seen the process in which professional investors put money into startups on TV shows like Shark Tank and Dragon’s Den, yet in the real world, the process is a little different.  First, there’s a strong chance you’ll never make it through the front door… but if, and when, you do… investors tend to be a little more collaborative and helpful in terms of shaping your idea than on such programs where it’s a basic yes or no.
Often times, investors will make suggestions for you to implement, and upon completion, will invest in your business a little further down the line – as this lowers risk and also offers them a chance to assess your productivity levels, see if you are coachable, and implement plans with action, rather than just talk.

3. FRIENDS AND FAMILY

Friends and family can be a great option, as it’s certainly the most convenient and cheapest form of borrowing – however, be mindful that if you borrow money and things don’t go to plan, this can have a devastating effect on your relationships with these people.