5 ways to fund your Business





A business cannot successfully operate without money, Robert A. Rice Jr. said “An entrepreneur without funding is a musician without an instrument”. It is therefore essential for you to know how you can raise funds for your business, some of the methods include:

1. Self-funding
For new start-up businesses, you can decide to fund your business from your own personal money or savings account. Self-funding can also include getting the amount you need from your family or friends who are willing to support your business. The method of self-funding allows you to have full autonomy over your business, and you don’t need to be accountable to anyone concerning the appropriation of funds. Though, this also means you alone bear all the risks and potential loses. The downside to self-funding is that it can be mostly used for small scale businesses, except for instances where self-funding is combined with other sources of fund for a large-scale business.
2. Investors
Another way to get funds for your business is by pitching your business idea to a prospective investor. Investors can give you funds for your business in the form of venture capital investments, which means in exchange for giving you money, the investor will want a certain percentage of your company, and a seat in your board. Involving an investor, means you no longer have full ownership and control of the business, the investor will expect some form of accountability to ensure his/her investment won’t be futile.
The bright side to it is that, having an investor means you can do more with your business and take it to a larger scale. You can take higher risks in exchange for potential higher returns.
3. Loans
In cases where you would like to retain full ownership of your business, but you don’t have enough money to start it or keep it running, another option is to get a loan from banks or credit unions. Getting a loan will require you to have a business plan and tender financial projections of up to 5years to show that the business is capable of repaying the debt incurred from the loan. Loans also mean you pay an agreed number of percentage in interest to the bank, and paying back can stretch over a short period of time (months), or a long period of time (years), judi slot depending on the amount of money borrowed and the terms of agreement signed.
4. Business grants
Applying for business grants is another way to raise funds for your business. Governments, Non-governmental Organizations and even business moguls often give out grants to people to start small scale business. Getting a business grant involves meeting some eligibility requirements laid down by the grant giver, completing a form and submitting an application.
Some business grants include the ‘Tony Elumelu Foundation Entrepreneurship Program’ and ‘Africa’s Young Entrepreneur Empowerment Nigeria (AYEEN)’.

5. Partnership
Starting a partnership is another method to get enough funds to run a business. A partnership means the capital needed is split into two or more ways, which makes it easier and faster to gather together money. It also means making decisions and bearing risks won’t have to be done by just one person. A partnership with someone you can trust to do business is actually a good idea, after all, they say two heads are better than one.

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