You may have a great idea for a venture and need initial funding to get it off the ground. Maybe you’ve got some momentum for your business but need that next injection of investment to take it to the next level.
Whatever stage you’re at, you’ll be considering funding at many stages along the way. But what sources of financial support or investment would suit your business? Read on to find out more.
Business cash advance
You could consider a business cash advance from a reputable finance provider. This is a form of lending suited to businesses that use card payments. It takes into account present and future payments on card to work out flexible monthly repayments, rather than a fixed amount, based on a total cost agreed at the beginning of the term.
The money borrowed is repaid through revenue from your customers’ card payments. This means it’s often very suitable for sectors with more seasonal cash flow, as you pay back portions of what you’ve been paid. This means you’ll repay more when you have higher revenue, so it takes the pressure off slower months.
Angel investors
If you’re a start-up with a flashy idea that is attracting plenty of interest or occupies a unique part of the market, you may be able to convince others that you’re a worthwhile investment.
Ever seen Dragon’s Den and wondered how it works? If that’s the case, look into angel investors. These are people with a high net worth who inject capital into a business or start-up and take ownership equity for investing.
As it’s in their favour for your venture to be successful, they’ll also usually use their experience to offer advice. Because of this, you should try to find an angel investor with knowledge of your sector or specialism.
Venture capitalists
Some organisations choose to invest in nascent companies which have a very high potential for growth in exchange for private equity capital. It usually carries more risk but may pay off more.
Like angel investors, venture capitalists can offer support. However, they may wish to have a more direct say in certain decisions during these crucial early stages.
Crowdfunding
Rather than asking a single or small number of investors to inject a lot of money into your business, you could consider asking many people for small figures instead.
Crowdfunding is often done online on specific platforms, especially for creative projects. You’ll need to put together a persuasive business plan to convince people to invest.
Friends and family
Some people ask friends and family for loans or support. It can be a good idea for strong relationships when businesses do well.
However, it’s important that you don’t jeopardise a connection or risk other people’s financial wellbeing.