10 Funding options to raise Startup capital for your businesses

Startup

Staring a new business in today’s world is not at all easy. Studies have proved that people who try to create a startup usually fail due to lack of funding. Also, a recent study has concluded that more than 90% of the businesses that are new do not succeed especially in the first year of their maneuver. This is because they don’t have enough money to make the business a successful one. Funding is one of those issues in Indian humanity which is very much observed.

Due to lack of funding, there are many business houses which when started had to close their business. It has now turned as one of the most obvious and common reasons for closing a business or startup. Everyone knows that Money is the blood of business. If the business is a body and it does not have its blood that is money then it will surely not survive. Even you can do many adjustments and put all your strength t run that particular business. But, still, it will not succeed.

Need of Capital for every business

Every business needs some capital. Obviously, for starting up with it needs Physical capital and then for working on operations, it needs working capital. But fixed and working capitals are overall a capital which is the basic requirement of business. For a generation of revenue, capital is a must. Capital is essential for every business out there.

You might have heard many businessmen or people who had started their business talking about the funding. We usually listen to a common sentence from them which is “How do we arrange funds”? We are very much familiar with this sentence. However, we usually cannot find a solution to this problem. But, now we can.

Capital usually depends upon what type of business you do. “What is the nature of your business” is the major factor which decides how much capital or funding will be needed for a business. So, keeping all these things in mind, we are now going to discuss 10 funding options to raise startup capital for business.

10 funding options to raise startup capital for your business are –

  1. Self-funding your startup business – Self – funding is popularly known as Bootstrapping. Self–funding means starting your business or financing it with your own funds. It is considered as one of the effective ways to make startup a huge company. If you are one of them who are starting the business for the first time then self-funding is really for you. You can use your savings or money that is with you in a bank to establish your business. It is considered very effective ways because without any formalities you can actually start up your business and make it reach to a next level.
  2. Angel investment in startups – Does it sound a little weird? Maybe to some people. So, let me tell you what actually the option is. Angel investors are people who have surplus fund. They are the one who is willing to invest in startup businesses. This is the newest and very much in trend funding options for startups. It is interesting to note that those people even offer free mentoring to people whom they fund.
  3. One of the funding options includes Crowdfunding – Crowdfunding is one of the latest funding options for a startup business. Do you how it works? Let, me clear. Any startup which needs money can enter a comprehensive and thorough portrayal of his/her business on a platform of Crowdfunding. They need to mention each and everything regarding business and then the people will read about your business and if they feel like giving money and they trust you as the genuine business then they start funding you.
  4. Venture Capital as a funding option – Venture Capitals are funds that are supervised proficiently and competently. These funds are invested in large business houses. However, they are also useful for those startups which are grown and have started generating revenue.
  5. Funding from Business Incubators & Accelerators – Nowadays, businesses or startups consider this funding option very necessary for their business. These two terms are almost same, yet there are some differences. Incubators are the one who nurtures or nourishes a business or startup. They provide training, tools, shelter and many things. Accelerators, on the other hand, are more like Incubators but they help to run a business. One of the best funding options it is considered because business can grow with many people.
  6. Funds by Contests – Winning a competition or any contests have now become one of the great funding options for people who have startups. It has tremendously increased and is a good way to make money for the business.
  7. Raising funds through bank – When thinking of funds, everyone whether businessmen or normal people they think of the bank. Bank provides the loan to business houses on certain terms and conditions. It usually gives two types of loan, working capital loan and funding.
  8. A business loan from Microfinance providers – There are some people who do not have access to conventional banking services. For them, Microfinance is an option of funding their startups. This option of funding is becoming popular especially for those people who do not have higher credit ratings.
  9. Funding options include Government programs – Government nowadays is coming up with programs to fund the startup businesses. The government of India has already funded 10000 crore startups in 2014-15.
  10. Other options of funding – There are many other options available to fund any business. Some of them are selling assets or selling the products before sale or even there are credit cards available for funding of the business. These options are also very useful for funding the business.

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