Tuesday, February 26, 2019

small business ideas

small business ideas


How To Fund Your Start-Up Business Idea - Forbes

Posted: 25 Feb 2019 01:54 AM PST

Loan counselor working on tablet pc, ensuring loan applications are correctGetty

You've got the idea, the drive, the know-how: how about the capital? Funding is an essential part of any business, as without the seed money you'll be unable to fire the starting gun on your, er, start-up.

Entrepreneurs are an incredibly clever and industrious bunch, but many are in the dark about how best to fund their start-up business, preferring instead to focus their energies on a core offering. One supposes that reviewing funding options can seem like a dull, laborious task when you are devoting time and attention to your genius idea. In any case, great ideas can only fulfil their potential if they are backed by stable investment.

Read on to find out the best ways of obtaining financial backing for your start-up business idea.

1. Pursue a grant

The less monied cousin of a bank loan is a grant. While you shouldn't expect to be cut a massive check, there are dozens of grants available, offered by national and state governments (as well as private enterprises) in the interests of stimulating the economy and growing the jobs market so it's worth checking out your options for funding your startup.

These financial injections can help you save money on premises and fixed rates, purchase cheaper IT or manufacturing equipment and fund staff training. The main drawback, of course, is the fierce competitiveness of such grants, as well as the box-ticking involved: it can be a frustratingly drawn-out process, but that's the tradeoff for retaining equity. In the US, start-up grants are offered by organizations such as Small Business Innovation Research (SBIR), the National Association for the Self-Employed (NASE) and Idea Cafe.

2. Crowdfund

Person's Hand Protecting Stacked Banknotes Surrounded By Human FiguresGetty

Crowdfunding is a favorite of the digital economy, and probably the quickest way of obtaining finance for a new business. You don't even have to be massively tech-savvy to launch a crowdfunding campaign, but what you do need is a compelling pitch, one which strongly references your start-up's potential for growth, as well as a knack for interacting with your cash-rich community. If all goes to plan, you'll have capital you don't need to pay back, without ceding any operational control. As a side benefit, crowdfunding is a nifty form of advertising, a way of stimulating public interest in your company before it's even made its debut. The difficulty, needless to say, is in getting your voice heard in the vast crowdfunding landscape.

3. Family and friends

The idea of hitting friends and family for cash doesn't sit well with some entrepreneurs, but many of the world's top magnates readily admit to borrowing from their social network early in their careers. As such, you should have no compunction about doing the same. Soliciting short- or long-term loans from friends and family might lead to some domestic squabbles down the road, but you won't usually have to pay them back with interest added. Indeed, you might not have to pay loans back at all, depending on the generosity of your creditor. On the other hand, it's not easy to put together a hefty bankroll relying solely on family and friends; and you have to ask yourself whether you really want to risk straining meaningful relationships.

4. Get an angel investor on board

Don't pray to the angels; seek angel investors. Targeting high net-worth individuals who have a track record of supporting start-ups isn't difficult to do, but the challenge lies in convincing them you're worthy of their investment. There are many online angel investment networks, as well as local investor groups you can pitch to in person, so do your research and start submitting your pitches. Find the right angel investor and not only will you benefit from their financial support but also their wisdom: oftentimes, they offer mentorship as a side dish alongside their capital. On the other hand, they generally offer less financial backing than banks and venture capital funds.

5. Raise money yourself

Entrepreneurs are a hardy, headstrong bunch and many elect to fund their business all by themselves. Breezing past the bank, they sell their possessions, save money from their day job, invest in various endeavors and free up capital by remortgaging (OK, that one does require a hasty U-turn to the bank). By going it alone, you'll retain complete control and be unburdened of the interest and strain of other avenues. And this decision has a precedent: over 90% of start-ups get up and running without the aid of loans or grants. On the other hand, raising money can become a full-time job in its own right – taking your attention from your business. To bootstrap or not to bootstrap: that is the question.

6. Seek venture capital

Finding a venture capitalist who shares your vision, or at the very least believes in your ability to turn your idea into a successful, profitable venture, is a good way of raising cash. Of course, you will need a fine-tuned business model, ideally one that's ready to scale. The main con with this option is that venture capitalists are typically looking for the next big thing, and so many entrepreneurs struggle to convey the scale-ability of their enterprise. Venture capital funds, by their very nature, have a short shelf life as they generally seek to recover their investment, turn a profit then move on to the next fresh start-up.

7. Good ol' bank loan or line-of-credit

closeup of a young businessman using a tablet on a table full of chartsGetty

In the modern age, it almost seems anachronistic to seek a bank loan. But if you've a solid credit history or existing assets which you're happy to offer as collateral, as well as a workable business plan with clear profit forecasts, it's still possible to launch your start-up with an infusion of bank cash. The advantages of this option are that you retain full equity, you can feasibly obtain a large figure and that you can build your credit; the negatives are that you'll need to pay back everything, plus interest, or leave yourself vulnerable to bankruptcy.

8. Ditch the bank in favor of micro-finance

Small-scale entrepreneurs can access capital via microfinance, circumnavigating the bank entirely. This is an especially good option for people with a bad credit score or track record, as micro-finance institutions like Non-Banking Financial Corporations (NBFCs) are more willing to green-light loans to individuals normally deemed high-risk. In essence, such organizations exist to promote financial inclusion and cater for those at the bottom of the financial pyramid. Pros: no need for assets, low interest rates. Cons: modest loans, various documentation (references, financial statements, business plan etc.) required.

Conclusion

Needless to say, all of the aforementioned options require a good deal of consideration. What might be right for one budding tycoon may not be right for another. For example, you may have an excellent bank manager whom you implicitly trust, and a robust line of credit, making a bank loan the perfect option. Or you could have a supportive network of financially-secure family and friends willing to back your idea to the hilt. Perhaps a combination of funding options is best, but only you will truly know. The important thing is to go with a funding option with which you are comfortable and confident so that you can focus on turning your business idea into a success.

How to get your business idea on 'Shark Tank' - AZ Big Media

Posted: 25 Feb 2019 11:50 AM PST

Shark Tank is a binge-worthy show meant to inspire people who tune in to chase their dreams. Entrepreneurs and innovators apply to pitch their breakthrough business concepts, products or services to the "sharks" in hopes of landing investment funds.

Approximately 45,000 people apply to get on Shark Tank every year, but less than 1 percent of applicants get to pitch their idea to the sharks. And the percentage of people who actually make it on television is even smaller. But just because your chances of making it on the show are slim doesn't mean you shouldn't try at all.

You need to do your research and ensure your business pitch is perfected. Learning from the success and missteps of other business owners and inventors who have either been on the show or attempted to be selected will definitely be beneficial.

How to Get on Shark Tank

There are plenty of articles with advice on how to get your business idea on Shark Tank. We rounded up the top tips for you below:

1. Stand out from the crowd: As mentioned, approximately 45,000 people fill out the Shark Tank application every year. That's a lot of business ideas — but they're not all unique. You need to evaluate your business, understand the story behind your brand and be clear about what sets you apart from other businesses.

2. Express your enthusiasm professionally: It's great to be excited about your business idea, but do so in a professional manner; being overly emotional about your company may not translate well to the sharks. But not being enthusiastic at all will make them question why they should be excited by your business if you aren't even excited about your business.

3. Provide data, proof and performance: The sharks want to know that they will get a return on their investment (they are trying to make money just like you are). To reinforce your business idea, you should come prepared with all possible performance measures that prove your business is equitable.

4. Build a community: Building a community and large fan base will help sell your business idea to the sharks. If you already have dedicated consumers who are advocates for your product or business, this will help convince investors you're the right choice.

5. Be persistent: Don't necessarily take "no" for an answer — negotiate and try to persuade. Ask for advice or what you could do better so you know for next time. If you apply to the show and don't make it the first time, then consider applying again (and keep perfecting your application). Improve your business model so it's desirable for investors, and don't give up.

Interested in going on the show to pitch your business ideas? Use the Shark Tank applicationand follow the instructions on the website, where you can learn more about attending an open call or getting in touch directly.

Establish Your Business Before Applying

Before you apply to be on Shark Tank, Incfile can help you get your business in tip-top shape. We can help you choose or change your business entity type, research the business licenses you need, file your business taxes, conduct a trademark name search, change your Registered Agent or just learn more about entrepreneurship.

This article was originally published on the Incfile Blog

Lisa Crocco is a marketer for an international food manufacturer by day and a freelance writer/marketer for startups & small businesses by night. She's She's written for outlets like USAToday College, Career Contessa, Cloudpeeps, and Fairygodboss.

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