“Define success on your own terms, achieve it by your own rules, and build a life you’re proud to live.”—Anne Sweeney, Co-chair of Disney Media Network.
A million-dollar dream to enrich life and a billion-dollar idea for a new start-up is great. And having a good source for the funding is even greater as without funding, the dream would never find a way to blossom. Here’s some first-time founders’ guide to finding some ways for funding a start-up:
- Bootstrapping
Bootstrapping is starting the business without any external funding. To start the business with personal savings like saving accounts, credit cards or any kind of home equity lines is called bootstrapping. It is often considered as a greater and safer approach than borrowing or raising in the initial stage. Many entrepreneurs continue to bootstrap his/her business until it is profitable.
- Family Funds
This, indeed, is the next safest option. The internal network of family and friends would definitely like to help you with your flight. You can get a donation as a token of encouragement or a loan to be paid back.
- Crowdfunding
Crowdfunding sites are becoming popular by the time. The increasingly popular sites such as Kickstarter, iFundWomen, RocketHub, and IndieGoGo provide you a platform to raise money from individual investors and fund contributors around the world.
Alternatively, for a relatively smaller amount (somewhere between 25USD to 5,000 USD) a few micro-loan organizations such as Kiva and Accion, lend to start-ups and small scale entrepreneurs.
- New-Age NBFCs
The New-Age Non-Banking Financial Companies are business sensitive who provide quick business loan approvals and disbursements. They also offer some benefits such as flexible EMI schedule, lower interest rates, and zero payment charges.
- Women-Centric Initiatives
Many Government programmes offer loans and subsidies to aspiring women entrepreneurs. Several banks also provide structured loan options for women entrepreneur
- Angel Funding
Angel investors are human angels who help to fund small businesses. These HNI individuals or groups fund start-up early in the lifecycle in exchange for equity. The only requirement is that the angel would buy the essence of your vision and your capabilities as an entrepreneur.
To find angels, enquire other entrepreneurs in your network, or check out the Angel Capital Association, which counts over 330 angel investor groups. You can also look at AngelList, the website that helps entrepreneurs make connections with interested angels.
- Winning Entrepreneur Competitions
There are many government and private competitions organized every year for the entrepreneurs. The best start-up is entitled to a cash prize that can be utilized for the business. However, the start-up with the best idea, the ingenious MVP or product, and the business model is the one who always wins the gold!
- Incubators and Accelerators
Incubators are programs sponsored by private companies, governments or educational institutes. They support the entrepreneurs by offering them funding options, working space and other networking opportunities for an undefined period.
Accelerators are even more focused programs that provide funding options to women entrepreneurs and support services for 3 to 4 months. They offer capital investment in exchange for start-up equity.
-Upama Goswami