Funding a business have been regarded as the major challenge facing enterprenurs world wide. Many have had problems thinking through the clock on how to generate money to fund their businesses. This write-up will focus on how to use other people money to fund your Business. The following are such avenue:
Family and Friends
This is a main medium of generating funds for a business that is often ignored by many. One will need to present his business plan to his friends or family explaining his cash flow and the need for the funds if it was an existing business.
Banking industry
Most enterprenurs are afraid of taking bank loan because of the high interest rate but it is a good source of fund for existing businesses with high turn over rate and predictable cash flow. Although, collateral or track record of banking with the bank might be required from costumers before loans are approved.
Government grants
A lot of enterprenurs ignore government funding, not knowing that it's represent a good source of funding because they don't usually attract interest rate. They usually sufficient to support small and medium scale businesses.
Cooperative savings
Local cooperative societies represent a good source of funding for business too because their interest rate is always low and members are often allow to take 3X or 2X their savings. This cooperative loan can be used to generate finance for both new and existing businesses.
Sales of property
Selling off liabilities to invest in a business is one of the easiest way to raise funds for business. At least these properties are converted to income generating ventures. Therefore, if you are dreaming of starting a business and funding is the challenge, look around you for properties that are actually liabilities (properties that are not generating money) and convert them to assets.
Thank you for reading my write-up.
Depending on the country where you live the options are different and of the 5 that you name 2 are executable anywhere, these are those of family and friends and the sale of properties. When it became fashionable in my country the song of Roberto Carlos in which he wished to have a million friends, the young people joked that if each one gave us 1 bolivar we would be millionaires, and although it was sarcastic it is not far from reality if instead of giving it to us we can involve them in productive projects, in fact in many countries family cooperatives have been successful and selling properties is something basic, since we are used to accumulate things that we do not use or that have some defect and as the adage says, the garbage of some is the wealth of others, good subject.
Greetings friend, the correct financing of the business is vital, basically it will determine its start up and later the payment of the financing must be covered by the profits, so loans with high interest rates can be detrimental. Any of the options you have mentioned is possible, I think that choosing the best one will depend on the type of business and the entrepreneur.
Hi @gboye1
Financing a business is really one of the neuralgic points when we set out to enter the business world.
The five proposals you mention represent a certain possibility of raising the funds for that initial capital, I particularly consider the sale of an asset to be quite effective in directing those funds into the new investment.
Have a great day!
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STOPInteresting info, we live in difficult times and this may help many people to keep their business alive...