So many people speak about money like it is all that there is when you want to start your business. Well, the truth is that money is an important tool to start your business but not the only. There are so many other aspects we have to consider when starting a business. There are also ways to get the kind of money or funds that you will need. In this blog series, I will share methods of how to raise the funds you need to start your small business. It is all about investment. Investing into your idea.
Investment jargons? Fund your business practically!
But when you hear the word “investment” somehow our minds might identify it with large concepts like stock market, cryptocurrency, treasury bill, bonds, savings account, Equity, mutual fund, money schemes and scams, ROI (Return on Investment) etc. These are big jargons used in the financial space to classify different finance instruments. For you as a micro business, let’s come into your day-to-day reality and explore more practical and sustainable ways to invest in your business. However, if you are already baptised into one or more of the above named financial instruments, enjoy the deep!
Over the past 6 years, I have started the Joadre Fashion project where we work with micro businesses to product fashion for customers in Europe. So my interactions with these enthusiastic entrepreneurs always leaves one big question unanswered. What is the next level? Over the top answer is I need money to get to the next level, but my question was what is the next leve?
So somehow, we have been made to believe that it is just money we require otherwise we cannot move to the next space we want to. The next level will require some form of investment but it might be beyond money. Look, the cambridge dictionary sees investment as the action or process of investing money for profit. But for you as a small business, you can consider investment as a means to bring capital to build their businesses. It is more than just raising funds for your business. There are things you can do that will transform into funds for your business. Watch our seasons YouTube beneath and read on for more details:
Articulate your plan before your raise funds for your business
You can only design these practical steps that would generate funds for your business if you actually have a business and know exactly what the business is. No matter what your idea is, there might come a time that you will have to articulate it to someone. When that time comes, you can visit our blog on how to write a simple plan for your idea to develop the kind of articulation you will require. Now let’s say you already have a plan and you want to move to the next step, here are some areas I strongly recommend you invest in.
Different kind of investment to take you to the next level
- Monetary investment
- Investment in your skillset – Brush up your skills. Know your business industry.
- Investment in your Mindset – Feed your mind with the right kind of information. Also take a break from this process of feeding our mind to be able to tap deeper into your intuition for direction.
- Investment in your community/social – Working integrative with the community you are based in is very important to build a sustainable customer relationship. When you work within our community, let it be more about what you can offer not only about what you want from the community.
- Investment in your business – Many are very carried away about raising funds for their business but they actually do not have a good product. Read more about using deep mindful strategies to build your small business.
Before we dive into different ways to raise funds for your business it is important that you ask yourself these questions. Why do you need money? Would it be for working capital, cash flow, faster production laps etc.? If you have thought about what you will do with the funds you raise through careful planning, accountability, achieving milestones, then please do it now. Distinguish between your money and someone else’s money!
Here are some ways to raise funds:
- Moneytars investment
- Professional investors to Angels!
- Crowd funds and investment
- Product/Service pre-orders
Get your loved ones involved!
Family and friends is the first way to go about getting startup money for your idea. It might sound to be the less complicated way to raise funds for your business but be careful. This is either Love, guilt or favor money at times. Also because the money is coming from your Da or aunty does not mean you are not accountable. Topic for another blog! Getting money from family and friends is probably faster and you might not have to pay huge interest. In this blog I explore more about raising funds.
Try to get a loan – raise funds for your business.
You can get a loan from different platforms. From corporate banks to charity organisations. And by the way you should ask your Church or faith-based institution! Seriously, why do you give tithes and offerings? Yes, for the church’s welfare because believe me you, God doesn’t live by our human conceptualised monetary system. So if you take to heart the welfare of the church or faith temple, then when you need investment to build the business from which you will later pay your offerings back, there should be opportunity to get support. I know some faith organisations provide this opportunity, so ask!
Professional investors to Angels!
Angel investors and professional investors or simply wealthy professionals like well paid or earning doctors, entrepreneurs, bankers, lawyers could be potential people to ask for loans as well. Professional investors or lenders might want more than just an interest back. Some might want to be a part owner of your project or business. So think carefully. In our upcoming Next Level Series, we will interview some legal experts to get a concrete view and advice about how to go handle professional investors.
Quick info, many professional investors look for around 25-30% return if they are part of the business and may want to get out of the business “EXIT” around the 5th to 8th year. What this exactly means, I will expand in the full Next level series. You can check my YouTube channel regularly, or just subscribe, so you know when we have interviews about this.
Get grants to raise funds
If your business or project has a sustainable and/or social component as its foundational element, then read more in my blog on how to get money for the mission.
Crowdfunding or Crowd investment
In this blog – how to raise funds, I list some crowd funding and investment platforms you might want to explore.
Go to platforms where you can portray your products and services and they allow people to make preorder. This is one of the money secured ways as you end up always selling your service or product. So of course you have calculated all your profits and so on, so you get to build your capital. This is the space where you can build your own website to take in orders for your services. I really advice this – To start with our own money and try to find customers seems to be the best way. Create a real business that makes money. When you expand an dit works, you can go to raise “expansion or growth capital” instead of startup capital. why? You spend so much energy and time raising money instead of selling your product and service.
Ok, so this was a very long blog article, but raising funds for your business is also not an easy job. There is even still so much more we can explore. We have a “Next Level Series” coming up when we release our on streaming platform Joadre app. You can pre-sign up now to join our tribe and be one of our founding members. In our streaming app, we will release full series on practical ways to grow your business. I am also on Instagram, though not extremely active but at least you get to see what’s happening from time to time, so it will be nice if you follow me if you are on instagram.
Thank you for studying this far. Drop your questions or comments as this will help us also create better content to answer all your open questions.