Five Ideas for Small Businesses to Raise Funds
Larger companies are typically able to draw from a greater range of funding sources, such as investors, shareholders, and prior business reserves. Most sole proprietors and small businesses, on the other hand, find it challenging to secure the resources they require.
Projects will stall if there is insufficient money available, regardless of how well a business uses its available funds. Thankfully, smaller teams can benefit from a variety of unconventional fundraising strategies.
What are some lesser-known strategies for small businesses or solopreneurs to raise capital?
1. Provide value in return for money
Present equity. Put another way, ensure that the people on your team grow to be just as valuable as you. They will be able to see the company as their own as a result, which will motivate them to put in more effort to achieve shared objectives.
2. Obtain credit for business use
You might not have the time as a solopreneur to get the business financing you want approved. Banks are now offering new application packages. If your application is accepted, you could use the 0% introductory interest rate credit card as a no-interest loan. It will provide you with a time frame in which you can finance the business’s initial launch without having to pay interest on your balance.
3. Promote a complementary service
You won’t always be able to find investors if you’re a small team or a solopreneur just getting started. Raise money for an idea is difficult. One possible course of action would be to provide a service that is associated with your primary product. When you charge for your services, you can build trusting relationships that will help you later on when you launch your main product.
4. Research loans for small businesses
It all comes down to your past fundraising experiences and relationships. Because most VCs prefer to see a co-founder who can hold you accountable and advance your idea, it can be a little more difficult for solopreneurs. You should therefore investigate small business credit lines or loans because you retain your ownership of the company.
5. Utilize finance for invoices
If you’re a lone proprietor looking to raise money, invoice financing is an excellent option. This enables you to mediate the exchange through a financing company and receive funds that would otherwise be held up in a client’s account payable. Typically, the financing company will give you up to 85% of the total fee; the remaining portion (less lender fees) will be given to you after the client closes the deal.