As entrepreneurs, we face a whole lot of hurdles in trying to build a business from raw materials, Staffing, machinery and tools, technology and solving the above-mentioned problem requires money.
Most ideas never get to materialize physically because they lack resources. Businesses and startups most times fail to stand the test of 5 years before they crumble. All these rely on the soul of capitalism.
What Is A Business Capital ?.
Capital is a kind of money that is needed is needed or used to start a business Capital can also be linked to a company’s capital assets which require large amounts of capital to finance or expand.
Capital may be employed using financial assets or generated from debt or equity financing. Typically businesses will focus on three types of business capital: working capital, equity and debt capital.
Type Of Business Capital.
According to financial experts, there are three forms of business capital and they are.
1. Trading Capital.
Trading capital may be held by individuals or companies that perform a large number of daily trades.
2. Working Capital
This is the capital of a business that is used in its day-to-day trading operations, calculated as the current assets minus the current liabilities.
3. Equity Capital.
In finance, Equity is ownership of assets that may be attached to debts or other liabilities. Equity capital is funds paid out by investors to a business in exchange for common or preferred stock.
4. Debt Capital.
This money is generally in loan form. Debt capital can be obtained from private sources or the government.
Capital sources may include friends, relatives, financial companies, online lenders, credit card firms, insurance firms and federal loan programs.
Debt resources can be obtained from government or private sources. Sources of capital can include friends, family, financial institutions, online lenders and banks.
This is one of the riskiest ways to raise money for your business. Briefly, in this article, I will be taking you on a brief tour of how to raise money for an existing business or a news business.
How To Raise Capital For Your Business.
Most business needs to time to grow and going about seeking debt capital can kill your business because your business needs a lot of time to grow and mature and in most cases, a debt capital does not give your business that opportunity.
1. Sell the idea.
Most entrepreneurs feel reluctant to sell out existing ideas and in so doing many promising ventures and solutions never become reality. Never feels too reluctant to sell out an idea, Ideas will always come. Truth be told, Innovators and creators always have multiple ideas in their thinking bank.
So don’t be scared to release that idea. It might just be a stepping stone to bring all other ideas and innovations in your mind to life.
In the case of the early coca-cola days, a perfect example can be cited, the coca-cola founder John Stith Pemberton never had the idea to bottle the cola drink, the cola was then sold directly into a cup in drums not until Mississippi shop owner Joseph A. Biedenharn started bottling Coca‐Cola after he was impressed with its sales.
Take it or leave it, if you follow the natural law of 70- 30 ratio, you will have more than enough to kick start any idea you have ever dream off and I mean not spending all that you have.
As an individual, it is always right to learn the ways of the little ants by cultivating saving habits. Economists and financial experts recommend you are free to spend up to 70% of your income but you must save 30% as the case may be.
Little drops of water make an ocean, you never can tell what that little amount can become in a short while. Learn the ways of the ant who never spend all they have and always make sure they have something to fall back to.
3. Family And Friends.
You family and friend could also do a lot to raise a whole lot of money for your startup idea or business.
If your business plans postulate that you need 1 Million Naira or let’s say $5,000 to start a business you can talk to 5 people to help you with 200 Thousand Naira or better still 10 people to help you with 100 Thousand Naira or 20 people assisting you with 50 Thousand Naira as the case may be.
I know that our hands are not all equal, but all the same, if you cant find reasonable people amongst your family and friends to help you kick start your business by contributing in one way or the other then you have relationship disease, I highly suggest and recommend you change your circle of friends or better still explore all other option involved in raising capital for your business.
4. Selling your liabilities/assets.
Most of us in one way or the other were privileged to own a major property or goods either previous purchase or inheritance these could include houses, cars, jewellery and other business assets like stocks. Trading this off for some cash to start a business would not be a bad idea at all.
5. Marketing for commission.
Whether you agree with me or not, everyone is a salesman. We, humans, are wired to connect and reach out to people. Marketing for a commission is called affiliate marketing.
Taking up a sales job and receiving commission is not a bad idea either, so many companies and individuals have goods that need to be sold, approach them and discuss a commission. commodities ranging from cars, houses can be sold and be used to generate high-level commission.
If you do not have access to the above-mentioned commodities, you can look for a local factory, warehouse or industry around and approach them for sales.
Here is an article I recommend you to read to help you get started with affiliate marketing.
6. Start with the idea.
There are still ways to go around getting our business idea to work even without the appropriate fund at hand.
Most times angel investors and business funds needed to sustain the business do not show up until we start something no matter how small it may be.
There is power in starting small. You never can tell, Someone somewhere needs your innovation but is just looking for a starter.
A perfect scenario can be cited with the wright brothers who started had the idea of aircraft to design the Airplane, They did not think of funds to build bigger planes or expand the industry, they just simply started with their idea.
Another example is Colonel Harland Sanders who Started Kentucky Fried Chicken Popularly known as KFC during the great depression which took place in America in 1930, despite all economic downturns, he was able to scale KFC into a widely recognized business worldwide. Other smart and stress-free ways to raise capital for your business are.
7. Gratuity and seasonal benefits.
We human beings are made up of a network of other people, somehow along the journey from childhood to adulthood we meet and establish a new connection in the form of relationships, either family, work and business.
Most times we receive seasonal benefits as a form of reward from our previous and past relationships.
These benefits can come in the form of cash, kind and all useful material benefits useful in running our lives.
This can also be applied in the area of work. Most employees devote their lifetime and energy to a company they previously worked for and it is no doubt as soon as they pen down their resignation they are often rewarded with one benefit or the other in most times in forms of gratuity and seasonal benefits like pension and the likes.
Having brought clarity to this point, it is very obvious that an aspiring business owner and entrepreneur can make use of these benefits to start a business of his/her own without having to involve any other third party.
The Gratuity of some retirees most times runs into millions, the same applies to seasonal benefits of most individuals that involves cash, luxury houses, expensive jewellery tech gadgets.
Don’t just wait for any other source for your business purpose, that channel can be utilized as a liable source for startup capital for your business.
8. Mentors and angel investors.
By now you should know that the business world has two categories of people, the innovators and the starters.
The innovators are more of like an idealist, most time they do not always have physical cash at hand. The starters are like investors, they have the money but looking for a very profitable idea to invest in. People like Warren Buffet and Robert Kiyosaki fall under this category. The bottom line is there are people ready to invest in your business provided it is scalable and optimistic.
You just have to be able to locate them and to raise the hopes of your business being able to receive the fund, you have to prepare a business plan, that’s all they ever want to see.
9. Business Grants.
I am going to be a bit elaborate on this point because it stands as one of the surest means to get startup funds for your business without losing it.
Grants are financial aid needed for your business. A whole lot of African entrepreneurs are yet to really understand and yet alone be able to successfully access grants, I am yet to receive any sort of startup grant for my business yet but I sure know people who have received grants multiple times for their business and are still in the business of collecting grants yearly for the sole purpose of business.
There are over a thousand million organizations both locally and internationally whose major responsibilities are to provide SMEs, and optimistic business ideas with startup funds without any payback, YES!!! no payback, most people call grants free money and I’ll suggest you start making your business available for grants.
A lot of organisations and governments in recent times have engaged in regular disbursement of funds to empower Small and medium scale enterprises in their country.
First-class nations of the world like the United States, United kingdom usually allocate certain funds toward the successful running of SMEs in their economy, notwithstanding lower class nations like Nigeria and Africa at large have also benefited from this scheme. Grants are free, and you do not need to pay back
Most grant offering organizations provide entrepreneur’s with nothing less than USD 5,000 for their business and you are not required in most cases for illicit business documents, Just pitch something scalable that’s all, you get funding.
Here is an article I recommend you read to help you get started with business grants.
10. Try Crowdfunding.
Crowdfunding is the use of small amounts of capital from a large number of individuals to finance a new business venture.
Crowdfunding makes use of the easy accessibility of vast networks of people through social media and crowdfunding websites to bring investors and entrepreneurs together, with the potential to increase entrepreneurship by expanding the pool of investors.
There is so much to achieve with crowdfunding Imagine for a moment that you’re trying to raise $1 Million for your business, you can either achieve this funding by finding a wealthy investor who can provide all the money at once or better still ask over 1,000 people to give you $10, is called crowdfunding. The concept of crowdfunding is built on the principle of democratizing the process of raising capital.
Rather than rely on the pool of a few wealthy investors, banks, or institutions that have deep pockets, crowdfunding allows entrepreneurs to raise the same amount of capital from a smaller group of investors whom we may call the crowd.
11. Position Yourself for Miracles.
Dear readers, whether you agree or not, there is a supernatural dimension to this present world and it’s high time you learn to take advantage of that, we are created in three dimensions which are the soul (mind), Spirit and Body.
The creator is spirit and he that must tap into the unlimited resources and abundance of the supernatural must learn to flow in the dimension of the spirit. Most times we find ourselves in the pit of life without having anybody to help or assist us, and we often feel hope is lost, dear reader it’s not a time to weep or lament, it’s a time to turn to the creator.
There is a whole lot that can be achieved via the supernatural but not everyone is willing to take that lane. Beyond the physical world, there is a supernatural dimension controlled by the creator himself, wonderful ideas and innovations from business, tech and all other aspects that makes humanity what it is today are generated from this realm.
Getting a startup fund for your business can be a heavy-duty task especially when you don’t have enough money to start.
Here is an article I recommend you read in other to help you establish your business.
Also if you need a guide to help you in marketing, then you can read this article to help you get started.
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