Whether your company is a fledgling start-up, or a Fortune 500 rock star, access to capital is key to building a strong business.
Thankfully there are a variety of solutions available to help companies raise capital and take full advantage of market opportunities.
One of the hottest solutions for raising capital is crowdfunding. It’s exciting and incredibly public. Create a quick profile, record a video pitch and pray your friends and family spread it around the globe.
To be successful, you’ll need to:
- Have a hot product or service to offer in return for funding.
- Work with someone who’s amazing at creating compelling video.
- Go crazy with online marketing to draw potential supporters to your profile.
Remember, with crowdfunding, you’re giving away a product or service, not equity. If you hit your goal, it’s your responsibility to make sure the promises you made are delivered upon with exceptional products.
To get a feel for how to create a killer pitch, check out these insanely successful crowdfunding pitches:
Venture Capital Firms
Similar to the sharks on NBC’s hit show, "Shark Tank", venture capital firms provide funding in return for equity in an idea or concept.
To successfully raise money with a Venture Capital (VC) Firm you’ll need to:
- Create a killer business plan, packed with market research and a strong financial forecast.
- Work your network to get past the gatekeepers and earn the opportunity to pitch to the VC’s investment board.
- Craft the perfect pitch that comprehensively explains the opportunity and then be prepared to answer some serious questions from the board.
You should go into the meeting with a VC firm expecting to look foolish by the end. No matter how much research you do, there will be someone on the other end of the table that will be smarter than you, or at least have more experience in your field. And that’s exactly why you should pitch to the VC firms.
Pitching will force you to improve your skills and hammer out your idea. You’ll absolutely learn something new, and you’ll likely learn about some weaknesses in your concept or idea that will help you become a stronger business in the years ahead.
Banks and Credit Unions: The Old School Method
There are a variety of investment options available from leading U.S. and European banks.
- Business Credit Cards
- Business Lines of Credit
- Traditional Personal Loans
- Mortgage Refinancing
These types of financial resources are great for people with solid credit history. It’s really important that you understand what you’re getting into though, as it’s relatively easy for a fledgling business to get in over its head in debt and end up in a financial nightmare.
Traditional lenders won’t be interested in learning about your struggles or better understand your market opportunity if you miss a payment. They will act quickly to collect on a defaulted debt if you fail to honor the repayment terms.
This is one of the many reasons that I shy away from taking on traditional debt when building a business. I’m much more open to giving up equity or taking on venture debt in order to grow my business with the flexibility I need to succeed.
International Financial Solutions
Different countries have widely different laws and regulations in place to help startups grow and access capital. Thankfully there are financial firms available to help provide financial advice around the globe. Working with a local partner is a great idea, as they’ll have access to tools and information that will make the process of gaining financial assistance significantly easier.
Online Loans: Fast Approval and More Competition
One of the easiest, hassle-free solutions for accessing capital is through online personal loans. There are virtually endless opportunities available online, and lenders from all over the world compete for the opportunity to lend you money.
Related Article: Raise to Launch: Using Equity Crowdfunding to Raise Startup Funds
Thinking about applying for a loan online? Here are a few tips to help keep you safe:
- Verify that the website processing your application uses Secure Socket Layer (SSL) security. The address bar in your browser should inform you of this extra layer of security being present.
- Read the fine print at the bottom of the website. Many of the sites online are not run by lenders, but instead by third-parties pretending to be lenders. In reality, the information you provide is shopped around to hundreds of lenders who will then fill your inbox with solicitations.
- Before agreeing to submit an application online, always do your due diligence and research the lender. It’s easy to be fooled by a sharp looking website into letting your personal information fall into the wrong hands.