People often wonder what is the best way of Looking for Funding for their business
venture, and the short answer to that is that there is no "best" or "right' way
to take when you're Looking for Funding.
The truth of the matter is that there are actually numerous ways of Looking for
Funding for a new business and which way is best will depend totally on your product,
your market, of course on your financial requirements, your burn rate and most importantly,
your personal and financial situation.
All methods of Looking for Funding have their own particular pros and cons and some
may not work at all for your specific situation. Whatever the method of Looking
for Funding you'll choose in the end remember to thoroughly investigate the ups
and downs and also remember not to jump in with both feet until you're absolutely
sure that you'll land on solid ground.
The first source you should consider tapping when you're Looking for Funding would
be your own savings and investments. Self-financing is a great idea if you can manage
it, when it comes to business; it is such a good idea because it doesn't make you
responsible to other parties if your business idea fails. Of course the bad part
is that if your business does go indeed under, it will be your money that goes down
the drain, and if you're not willing to risk your own capital then you certainly
shouldn't risk anyone else's.
Many entrepreneurs, after they've tapped their own savings and investment will start
Looking for Funding from friends and family. This method of Looking for Funding
works very well for some but a good piece of advice would be to never borrow money
from someone you'll have eat Thanksgiving dinner with. Nothing will cause more tension
in a family like lending money that is never paid back; although they might not
say it your relatives will be expecting to be paid back someday, you have to keep
in mind that when a relative is investing or lending you money they are actually
emotionally investing in you.
You could also be Looking for Funding through credit cards, but this can of course
leave you with thousands of dollars in credit card debt that would take a lot of
years to pay off if the business fails. But if you do decide to finance your business
on plastic you have to keep in mind that you will be paying extremely high interest
rates on the money you've borrowed and unless you hit it big you will be paying
for that money for many years to come.
If you're looking for Funding from a bank you'll find out that it will be next to
impossible to get funding unless you have collateral and a track record of business
success; this is the reason why many entrepreneurs are now Looking for Funding through
the equity in their homes in order to finance their business after they've been
turned down for a bank loan. However, although this method of Looking for Funding
makes more sense than building a business on a deck of credit cards, the financial
risks are still there. You'll have to pay this money back whether or not your business
succeeds, but it is indeed a good source of low interest money to get you started
and the interest may be tax deductible as well you'll have to check with your accountant
to make sure.