Just like being creative in business, you also need to be creative in sourcing the funds. This month we review 7 ways to raise funds for your business. 

1. Personal Savings/ Self-Funding

This is the best source of capital to finance your business as you do not have to worry about principal and interest payments. In the unfortunate event that your business does not succeed, you will only lose your own money that you have invested.

2. Personal Loans

You may be too proud to go to friends and family to ask for money to build your business, but borrowing from friends and relatives who have excess funds is a good way to finance your business usually being interest-free.

In addition to that, provided your credit history is not a train wreck, banks are becoming more and more progressive when it comes to personal lending.

3. Government grants

There are many valuable government grants available to small business owners to encourage business growth, particularly for innovative projects. Hiring an expert to help you put your application together who knows the tricks and traps is good advice when it comes to applying for government grants.

4. Credit Cards

Although credit cards have an infamous reputation, they are a good way to finance your business if they are managed and paid regularly. Funds being available to you 24 hours 7 days a week can be used to purchase orders and shop online or by phone. You can replay large sums of money in small easy to handle monthly instalments benefiting your cash flow.

5. Investment Liquidation

Selling your assets to raise capital enables you to start your business debt-free. Your assets include properties like real estate, cars, shares or stocks, etc.

Selling these properties to raise capital to finance your business is always preferable to borrowing money and paying interest on it, as you do not owe anyone other than inconveniencing yourself in the short term.

6. Bank Loans

When asking for a bank loan you usually you have to prove your worth first before a bank will consider your loan application. 

Unless you have the security (having real estate, assets) and have a track record in business which can be supported by financial reports and feasibility studies, a bank loan is not an attractive option as source of capital for a startup business.

7. Employees

You could invite your employees and shareholders to participate in your business success and growth through an employee/stakeholders share ownership plan.  This would provide you with some capital to fund expansion, release your equity and for employees/stakeholders to feel ownership of the businesses successes.

Click here to attend one of our award winning seminars to find out about other key ways to increase your capital