By Angela Wills
Starting your own business is one of the most exciting journeys in life, but the sweat and effort that goes into getting the business off the ground can be tedious. There are several things to be concerned with when starting a business, and one of the most overwhelming concerns for most is finances.
Every business owner needs to have an ideal plan and a little money set aside in order to make money in the new business venture.
As a means to acquire the capital needed to operate a successful business, you must be strategic, as all investors won’t see or understand the vision that you have for your business. For your very own business, identify the goals and locate an investor that can properly meet your financial needs. Below is a guide to help you locate the best investor to meet your needs. Make the choice and conquer your industry with no fears.
Banks typically offer loans for entrepreneurs. This process involves an assessment of the overall business, which includes the business plan, and a proposal that has been drawn up to show the product or service to be offered, financial projections, and plans to achieve goals to determine if you are loan worthy.
Just as the name indicates, this investor category could be your angel in waiting. These investors have the funds to invest in your business and often do so based on their belief in your business. This is a great alternative for those who have issues obtaining other investment types. These investments can occur in the form of a loan or stock with amounts varying from thousands, well into the millions. Typically, the investors want a percentage of return on their investment, or even partial ownership of the business. Startups are great candidates for this type of investment.
This type of investor may be more challenging to acquire because they often want proof that the business or service is solid. This translates to having a well-structured business plan, paired with a marginally high return of profit. Venture capitalists typically make large investments but almost always with a portion of the business at stake, such as a share of the business and a managing voice in the company.
Friends, Family and Associates
As odd as it may sound, family and friends want to see your business prosper and are often willing to invest in your startup. This could be a great place to start when seeking investors for a small business. Reach out to those who genuinely support your business efforts and be clear in describing the risks during your approach. Once interest becomes commitment, structure a legally binding agreement that explains the terms of their investment.