Small businesses and startups are on the rise in the U.S. — more companies applied for employer IDs in 2020 than they did in the 13 years prior. So, if you’re hoping to create something of your own, you’re not alone.
But even with so many other startups opening their doors, it can be unclear how to get your idea off of the ground. Currently, you’re wondering how you can get small business funding to cover initial costs before you begin to turn a profit.
Luckily, there are several routes for funding your enterprise. Here are four small business funding options to consider as you embark on this new, exciting pathway.
1. Bootstrap It
Have you ever heard the phrase, “Pull yourself up by your bootstraps”? It means you improve your situation on your own hard work. You can do the same with a small business, although it requires hard work and money.
Many small business owners get off of the ground on their own savings, credit cards, and home equity. It can be daunting to use these sources, but there’s a big reward if you only use your own funds. You won’t have to worry about paying back huge loans each month if you rely on the money you already have.
Of course, your savings might not be enough to get a business off of the ground. In that case, consider pairing your money with another source of funding.
2. Find an Angel
Outside investors are often necessary to get tech startups off of the ground. You can’t run a major business without staff and equipment, after all. There are online lists of these so-called angel investors: court the ones whose ideas align with yours, and you could get the funding you need to get off of the ground.
It’s not just tech that will require you to find outside funding, though — other industries require so much capital that bootstrapping won’t be enough to get them started. For example, there’s specific funding for trucking companies, as well as investors in a slew of other lucrative industries.
3. Crowd Fund
Smaller-scale business ideas might not require the same huge input from an angel investor. In that case, you may be able to use a crowdfunding site to raise the cash you need to get started.
Send the link to family and friends, and encourage them to share it with their networks, too. You can promise them your business’s wares once you get off the ground to further incentivize their donation.
4. Search For a Local Fund
Finally, your local government or business bureau may be able to help you get on your feet. Many such organizations will help you find the money you need to start your company. They can help you find angel investors, small business grant funding, and other sources of cash that can help you open your doors.
It makes sense why this would be a focus of local organizations and governments. It’s beneficial to the local area for more businesses to start to create jobs and stoke the economy. So, see what your town, city, county, and state can offer you.
Get Started With Small Business Funding
These are only four ways to get small business funding for your startup. So, start here, but don’t be afraid to get creative and raise funds in other ways, too. No matter how you do it, you’ll be on your way to entrepreneurship and, ultimately, making your dream a reality — and there’s no better feeling than that.
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