Small businesses have traditionally been the key drivers of economies in the world. They are, however, faced with unique challenges, a number of which are related to finance. If you have a small business or are just about to start one, we’ve curated some ways you could source for capital.
- Do it yourself
Small business owners often have to self-fund their businesses for a period of time before third-party funding opportunities become available. So, you need to prepare for this. You can start by putting some money aside in dedicated savings account for your business even before you commence operations.
- Family and Friends
Funding from family and friends is a very popular and effective way to raise some initial capital for a small business. Those closest to you are more likely to believe not only your vision but your ability to make that vision a reality. Just like Dangote who called on his Uncle, start calling on yours now!
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- Angel investors
Also known as a business angel, this is an affluent individual who provides capital for startup or small businesses, usually in exchange for convertible debt or ownership equity. This is a great way to source for capital, too.
- Small business loans
Startup businesses seeking money from the bank or government agency need a good business plan, profitable projections and some of their own money to invest in the business. Ensure that you request for loan figures that resonate with your initial budget for your business, so you can conveniently payback when it begins to yield returns.
- Crowdfunding
This is the practice of funding a business or venture by raising small amounts of money from a large number of people, typically through the internet. Get a bunch of interested individuals who are quite willing to donate funds, no matter how little to support a growing business. Social media is a good source to get such individuals at a go.
What other ways can you source for capital for your business?
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