Starting a business is expensive. Coming up with a great idea is the easy part, but securing funding is a challenge. Family and friends are an obvious choice, and banks can help with loans. Inevitably, your business will need outside funding to scale.
That’s why Paul Saunders founded James River Capital to help businesses find their ideal financing solution. Of course, he doesn’t just recommend his own products. Here are four ways to finance your business idea.
Always look for local funding opportunities first. There are plenty of organizations looking to fund local entrepreneurs to invest in the community. Pitch your business idea to local business development centers and your chamber of commerce to get it out in front of people who you ultimately want to be customers.
Talk to Angels
Angel investors carry that name because they save private companies from certain death with cash investments. In return, they take partial control of the company (and its revenues) to pay back their investment. The Angel Capital Association is a large network of over 330 angel investors for businesses to pitch to.
Crowdfunding has become a popular option over the past decade. Platforms like Kickstarter and Indiegogo give businesses a way to fund development of new projects. Prototypes can be materialized, surveys taken, and real funding from a community of interested users obtained. Unlike other forms of investment, crowdfunding typically relies on actual customers as investors.
Venture capital firms like James River Capital exist to help businesses that need at least $1 million in funding. These aren’t just ideas being kicked around – they’re fully functional businesses with working staff and resources that need to scale or pursue a new venture. Pitching to venture capitalists is what you see on shows like ABC’s Shark Tank.
No matter what industry you’re in or the size of your business, one of these four funding avenues is sure to pump new life into your business.