Funding can be a challenge if you are an entrepreneur venturing into a new business. Many entrepreneurs try to pitch their idea to the VCs and Angel investors, but the problem is that for getting the funds you have to give up equity shares—and if you raise too much money, it may result in you no longer being in control of the startup that you conceptualized.
However, in order to survive and grow in the highly competitive business environment, it is necessary for you to get funds. Here is a list of some of the best ideas for raising funds:
Loans and Grants
If you don’t have resources of your own, a traditional moneylender, like a bank, can be a good option. The funds that you can raise by this route will depend on your credit history and the existing assets that you are willing to put as collateral. You can also pursue the government funds or grants that are meant to be allocated for supporting new technologies and important causes.
Find a Strategic Partner
Try to find a complimentary business, whose interest is aligned to the business that you are trying to build. If the other side sees scope for growth through collaboration with your startup, they may be willing to give you royalty payments for completing your business development. For pursuing funds from such resources, your industry contacts and networking skills will play a vital role.
The central government and the state governments have started incubators for providing initial support to startups. Along with the basic infrastructure, these incubators also provide the startups with certain amount of funds for establishing their business. Most of the incubation centers are associated with major universities, community development organizations, or even large companies.
The rapid expansion of the social media and other forms of online networking are behind these crowdsourcing strategies that some startups are deploying for raising funds. In this case the entrepreneurs get their funds by soliciting contributions from large groups of people, especially the online community.
What are friends and family for, if not to help you in times of need! It is always easier to convince your friends and family members to invest in your startup. If you have some savings, you can also put in your own money to tide over the initial days till your startup starts generating revenues.