Raising funds for your startup can be a daunting task. Sometimes you get lucky and nab a major investor, such as Shailesh Dash, and sometimes you find a team of investors. For many folks, finding those investors is the part that ends their dreams before they begin. However, if you truly believe in your startup then you will be willing to do anything you can in order to make it happen. When you are that passionate, you will find an unusual way to raise capital you need. We have curated a list of ideas for you to consider for your startup!
7 Unique Ways to Raise Capital for Your Business
1. Crowd-sourcing is Your Friend
If you are unable to find investors for your product or service, check out crowdsourcing sites for help. Sites, like Kickstarter, are a hotbed for showing off your pitch and getting people excited. When people are excited about what you have to offer, they pay money as an investor. The remarkable thing about crowdsourcing sites is that you find your market easier.
2. Raise Capital through Family Support
Investor Shailesh Dash is a supporter of the family business and nothing brings a family together than getting your family on board with your startup. Share with them your business plan and your goals to really see them light up. Families are there for each other and often support our business endeavors. If a family member says, “no”, don’t take it personal! Move on to another family member who shares your vision.
3. Silent Partner or Modaraba
Modaraba is the Islamic form of investing in which one person invests the money and another manages the business and how the funds are used. In the U.S. this is similar when we take on a silent partner who does no actual work in the business but merely invests and receives significant return on investment.
4. Small Business Loans from Small Business Administration
If your service or product is a contribution to your local community, you should check with your local small business administration. Often when people do not qualify for business loans, they can seek out business loans through other organizations. Veterans and women do exceptionally well when they speak with the local small business administration.
5. Peer to Peer Lending
This one is not discussed very often and it should be. Local ethnic groups, small business groups, and local investment groups often offer peer to peer lending to support startups that they believe in and want to support.
6. Microloans Save the Day
When you don’t qualify for a loan, look to non-profits and private companies. Many offer small microloans of no more than $35,000 for the sake of promoting entrepreneurship. These loans are often Patriot Express Loans (for veterans) or Small Office/Home office loans (SOHO loans). An important note about SOHO loans, you cannot be working in multi-level marketing to apply!
7. When in Doubt, Pay it Yourself
If you are still struggling and just cannot get the financing from an outside source, look to your own wallet. Dip into savings and consider cashing out a retirement fund to finance your startup. It’s a risky take and could incur some serious tax liability. But if you are the success you think you will be, then it will be a perfect investment in yourself for the long run.
Investors are there, sometimes it just takes a little ingenuity to find them. When a traditional way doesn’t work, think outside the box and make it happen!