Business Startup Funding - A Step by Step Guide
For those who want to startup their own small business, one primary hindrance is finding sufficient capital for startup to begin moving toward their goals. The business startup cost can seem to be unachievable, and even threatening, unless you know where to look. Unfortunately, business startup funding is one of the main things that keeps people from getting initiated in business the first place, or from succeeding once they do manage to get started. But, on the up side,there are several programs and organizations that specialize in helping entrepreneurs to overcome this hurdle.
Finding business startup funding can be one of the biggest challenges for an entrepreneur. While beginning a new business venture calls for a great deal of research, skill, and preparation, many people have a difficult time coming up with the financial resources to get their new business off the ground. As a first step, you should prepare the list of various potential sources of funding available to you and determine which approach will be the best, given your own unique needs and time frames.
Business startup costs not only get in the way an entrepreneur from starting a new business but also can hamper growth of a new enterprise. On top of being a complication at the outset, having limited start-up capital can also make it difficult to hire employees or acquire sufficient inventory. Entrepreneurs can resolve these issues by utilization of variety of sources to find enough startup funding to be able to implement their plans.
How Much it Costs for Business Startup?
The answer to this question depends on the type of business that you are looking to start and the choices you make along the way. Some of the most critical parts to answering this question include:
- Do you have to invest in capital equipment?
- Will you be leasing a location or renting a location for the business and, if so, will that space require any renovations?
- Will you need to hire and pay employees?
- Will you need to purchase and maintain inventory?
Fortunately, many businesses i.e. Internet-based can be started with nominal budget and run from home with no employees, inventory other than a computer.
Sources for Business Start Up Funding
Business you are thinking about might require an up-front investment. If that is the case, here are just a few sources you might consider:
- Your savings or investments- For beginners, one must look to your savings account or liquidate some of your investments.
- Borrow from relatives or friends- While this is the path that many new entrepreneurs take; it should be approached with attention as it can lead to discomfort and hard feelings.
- Loan from the bank- A bank loan is often hard for a new business to obtain. To be successful entrepreneurs, you will probably need to show a professionalism, well-developed and maintained business plan along with a plan for repaying the loan.
- Credit cards-Another method is Credit Card that should be undertaken very cautiously and only if you believe that you can pay off the balance very quickly as credit card debt typically brings a very high rate of interest.
While choosing any of the above methods you should be sure to have developed a business plan that you believe in, best of your ability, a projected time frame for recapturing any money you may have borrowed to get your business started.
One most important thing in business startup funding is that you also need to invest in an office space that has a computer with good internet connection and a telephone. This will help you provide a place to have meetings with prospects in business growth as well as help you to maintain the professional image.