4 Ways to Raise Capital for Your Business

Lack of funding is one of the most common reasons that results in the failure of a new business. After a business plan is laid out, money is the most important element that can convert the plan into reality. There are different ways to finance your startup. Here is a list of 4 funding options for startups that will help you raise capital for your business.


Bank loans
One of the traditional forms of raising funds for your business is through bank loans. Banks and financial institutions also provide different loan offers to attract customers. It is important to have a well drafted business plan before approaching a bank for loan. With the increase in number of private banks, there are several options to choose from.

Venture capital
Venture capitals are managed funds who invest in companies that have huge potential and have generated enough sales. Venture capital is for small businesses that are beyond the startup phase. They usually invest in a business against equity and have exit strategy when there is an acquisition. VCs also provide expertise and mentorship to the business.

Crowdfunding is an innovative technique of raising capital. In this method funds are raised through a number of different sources. These sources include friends, family, individual investors, online payment via social media. There are several popular crowding sites like Kickstarter, Indiegogo, RocketHub, etc. which can be used to tell people about your business plan. Crowdfunding is a great way to raise funds if you are unable to get loan from banks. However, raising capital from this method can be time-consuming due to collection of the funds from different sources.

Startup contest
Startup culture has given rise to several contests as well where you can submit your startup business plan and the best business plan will receive funds to kickstart their business. This is the most innovative plan which sparks up the power of imagination among people. TechCrunch is one of the know platforms that organises contest for different startups.

Leave a Reply

Your email address will not be published.