What’s The Best Way To Fund Your Start Up?

Two of the key focuses of my blog are Financial Literacy and Money, and Business and Entrepreneurship. No matter what your business idea is, figuring out how fund its startup is key. Likewise many new businesses don’t successfully get off the ground do to difficulties securing startup capital. The following contributed post is thus entitled; What’s The Best Way To Fund Your Start Up?

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Starting a business can be expensive. Whilst some companies can started from home with nothing more than a computer and a phone, others require specialist equipment, licensing, inventory, insurance, work premises and a team of employees. The right type of funding for you depends on your circumstances and the type of business you’ve got planned. Here are just three of the main options available when funding your startup.

Take out a loan

For most people with expensive startup costs, a loan is the best option. This can give you instant access to the funds you need, allowing you to get your business set up straight away. It pays to have a good credit score – this will allow you access to lower interest loans. Banks and peer-to-peer lending sites offer some of the cheapest interest rates. For some people, there may be specialist loans available such as these personal loans of veterans at https://personalloan.co/personal-loans-for-veterans/. Other options could include an equity release or accessing your 401(k) early. Borrowing money is the best option for those that want to get started as soon as possible – you’ll soon be paying off monthly loan repayments, so you want to be putting this loaned money into action quickly so that you’re making an income to pay off this loan.

Seek investment

An alternative option to borrowing money is to seek investment. This involves finding someone willing to give you the funds you need in exchange for shares in future business profits. Seeking out investment can be a longer process than taking out a loan, however unlike a loan in which you have to start paying back interest straight away, you won’t have to start paying shares to investors until your company is up and running making a profit giving you a little more time. You could seek out an individual investor or investment company willing to give you the entire amount you need or you could look into crowdfunding which involves raising the funds from lots of different people. The latter option is most popular and there are sites such as https://www.indiegogo.com/ for doing this. Encouraging investors to fund your business involves having a good business plan – you may want to hire a financial advisor to help you generate projected costs. Having business experience behind you can also help your cause.

Save up

The final option is to save up the funds yourself. By using your own savings, you won’t have to pay any interest fees or shares in the long run. It is however the longest way of raising funds and not ideal for people that want to get their businesses started straight away (it’s probably only best for startups that require a small amount of funding, otherwise you could be saving up for years). There are business savings accounts out there that can collect interest and allow you to build up funds more quickly – it’s shopping around at sites such as https://www.businesscomparison.com/bank-accounts to find the best account for you. Bonds and CDs can also be a good option.

Author: anwaryusef

Anwar Y. Dunbar is a Regulatory Scientist. Being a naturally curious person, he is also a student of all things. He earned his Ph.D. in Pharmacology from the University of Michigan and his Bachelor’s Degree in General Biology from Johnson C. Smith University (JCSU). Prior to starting the Big Words Blog Site, Anwar published and contributed to numerous research articles in competitive scientific journals reporting on his research from graduate school and postdoctoral years. After falling in love with writing, he contributed to the now defunct Examiner.com, and the Edvocate where he regularly wrote about: Education-related stories/topics, Science, Technology, Engineering and Mathematics (STEM), Financial Literacy; as well as conducted interviews with notable individuals such as actor and author Hill Harper. Having many influences, one of his most notable heroes is author, intellectual and speaker, Malcolm Gladwell, author of books including Outliers and David and Goliath. Anwar has his hands in many, many activities. In addition to writing, Anwar actively mentors youth, works to spread awareness of STEM careers, serves on the Board of Directors of the Friends of the David M. Brown Arlington Planetarium, serves as Treasurer for the JCSU Washington, DC Alumni Chapter, and is active in the Dave Ramsey Financial Peace Ministry at the Alfred Street Baptist Church. He also tutors in the subjects of biology, chemistry and physics. Along with his multi-talented older brother Amahl Dunbar (designer of the Big Words logos, inventor and a plethora of other things), Anwar is a “Fanboy” and really enjoys Science-Fiction and Superhero movies including but not restricted to Captain America Civil War, Batman vs. Superman: Dawn of Justice, and Prometheus. He is a proud native of Buffalo, NY.

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