- What methods of funding will help to develop your business, if you don`t have your own funds? Go to the next page & find it out!
- Government grants
- Business Angels
- Crowd Funding
- Online advertising
In this post we’ll look at both traditional and non-traditional methods of financing business.
What methods of funding will help to develop your business, if you don`t have your own funds?
Go to the next page & find it out!
The form of a commission sale, implying that the owner sells his goods to the warehouse agent, securing the right of ownership of the goods until the moment they are sold.
In other words, the consignment is a way of selling goods with the help of an intermediary who receives its percentage (commission) from the sale.
If the goods are not sold for a long time, they will be returned to the owner.
Final payments to the exporter may be implemented only after selling the delivered goods. Thus, the consignment can also be seen as one of the options for a private loan for business. In financial aspect, this form is the safest for the company.
In recent years, business projects aimed at research and development work are willingly supported by the Government grants. In developed countries, grants are given to small business projects at an early stage of development activities.
Grant is a non-repayable funding, but reporting on its use is very strict. If the results are not being shown in a certain period of time, you may need to return the entire amount.
Credit lines without a loan allow businessmen to get a quick access to cash if there is a short-term gap in financial flows.
Overdraft is the easiest kind of short-term untargeted bank loan on business activity. It is provided only to trustworthy entrepreneurs with an impeccable credit history.
Interest rates and repayment terms are usually negotiable.
Business Angel is a private investor, which invests money in innovational startups in exchange for the return of investments and share in capital.
Business angels are savvy businessmen, who are interested in assistance to the younger generation. Often the objects of investment are some income-generating projects that promise further development. What is important is that business angels are willing to share their experience (mentoring and coaching).
Business angel business share ranges from 10 to 50 percent.
Business Angel cares about the “happy end”, i.e. the privatization of the company or merger with another one. So it’s possible that you will have to give up the work, despite considerable commitment.
Tweetsgiving project conducted on Tweeter by Epicthanks drew $ 10,000 for two days. People donated from 5 to 10 $.
Another good example is Calibre – the online platform for managing the e-books. As we know, the products (apps, games, programs) in beta-testing phase are provided free of charge in order to get the feedback, fix the bugs and promote business. Thankful users pay small donations to support the project.
Crowd funding sites are Internet platforms that help raise funds due to the large number of small investments.
Crowd funding became popular thanks to socialization and proliferation of the web sites of non-profit organizations, art representatives and businessmen. Worldwide there are about 600 platforms of crowd funding that attract billions of dollars in different business projects, the major ones are Kickstarter, Indiegogo, RocketHub.
When considering the possibility of financing the project by holding a crowd-funding campaign, remember that you will have to share your business idea and business model with a big audience.
If you know how to develop, promote and monetize the website, you will be able to:
- earn by selling it;
- earn the money from posting banner ads on the website or selling premium content, providing educational or consulting services.
This is a long-term business-project. In addition, continuous improvement of site indexing algorithm changes the position of a site in the rankings – and thus increases an income.
How to start a successful business on JiJi from scratch? Read the stories of real people!