How to Procure Funding For Your New Business Idea
If you believe that you have a great idea for a business then it is important to strike whilst the iron is hot, and get things off the ground as soon as possible. The key to getting your business up and running, is to make sure that you are sufficiently financed for your upcoming venture. Cash will be the single most important thing in your business both before you launch and afterwards and working hard from the outset to secure as much capital as you can, will help you greatly in the long term. Let’s take a look then, at how you can procure investment for your new business.
A bank loan is one of the most used methods of funding your new business and banks have been giving money to budding business owners for many years. You will need to supply the bank with some collateral to secure your loan and present a solid case as to why your business will succeed. The beauty of a bank loan is that the interest is usually pretty low and the repayments are weighted towards the end of the loan term giving you plenty of time to succeed first. Banks want you to succeed as this bodes well for them and so they will give you an advisor who can help you navigate through your first years in business.
Tax Credit Funding
The government has set up many tax credits for businesses which are working in the interest of the public and if you business falls into this category, you can capitalize on this and turn it into funding. For example, if you have a business in the science sector you can secure funding by way of SRED financing (scientific research and experimental development) which will be fronted up as cash, and repaid when the tax credit comes through. This is a great way to get the cash you need to get your business up and running.
For many years it was difficult for new businesses to secure funding from private investors but since the staggering success of many start-ups, investors are changing their tune. Investors who pump cash into start-ups are called Angel Investors and if you can find the right person who believes in your project, you can procure the injection of funds that you are looking for. In order to secure funding with an investor, you must have a solid business plan in place, know your figures and be able to explain just how you will turn your business into a success. Very often you won’t need to pay this money back, but you will need to negotiate agreeable terms for the investment which you will receive which could include giving up a small percentage of ownership. Angel Investors want you to succeed and their cash, as well as their knowledge, can really help you get your business off the ground.
There is plenty of money out there, they key is making sure that you are being creative when you look for it.