Every startup owner has to seek funding options from time to time. From new product development to backing your business growth, you need money for various purposes. Now, the traditional funding alternatives may work for some entrepreneurs, while others could have a problem in securing them. Some founders go for banks, which later denies giving them loans. A crucial thing to understand here is that loans are not that effective, and there are a lot of creative alternatives for supporting your startup. In this article, I will tell you some creative methods to get funds for your startup. So, let’s get started!
Top 10 Creative Methods To Get Funds For Your Startup
1. Personal Financing
Many startup owners may not find this one creative, but there is a lot of creativity within it. See, you are the only one who decides how to fund and how often to fund your business. No one is there who puts restrictions on fund allocations. Thus, you finance your startup the way you exactly want to do.
2. Friends And Family
There is no guilt in asking for seed capital from your friends and family members. In most cases, they will likely apply their resources to your startup. An advantage that exists with this option is these individuals don’t ask for any financial contracts. But, a limitation is they can offer funds that aren’t enough for your seed capital. Still, friends and family members are ready to help you.
3. Personal Credit Lines
Almost every startup owner today is capable enough to apply for personal credit lines. Anyone can obtain a credit card by showing a few histories of his or her business. Many new founders have launched their companies by using their plastic cards. With this method also, you are the one who puts control of funds.
4. P2P Lending
It is a funding method where some people build an organization and help each other. This world has a lot of examples of such companies that started their journey with Peer-to-Peer lending. Being a startup owner, you should follow such organizations so that you secure some notable investments for your startup.
You may have heard about crowdfunding platforms where an entrepreneur receives funds by offering some product samples or incentives. There are hundreds of crowdfunding platforms for startups in India. Here, the more you are creative and promising, the more investments you secure for your startup. Bring a brilliant idea to them and ask to support it with their finances.
Many organizations exist that offer microloan for new startups for a considerable duration. Their primary goal is to promote every business idea. Some of them can offer $35000, while others can offer up to $50000. Entrepreneurs who fail to get loans from the bank can go for this option. They will likely help you with some significant investments in your startup.
7. Vendor Financing
Quite often, you require tangible products to fill your inventory, and you convince vendors to yield your returns until you sell the products. Vendor financing can make an extension of a month for you, depending on the worthiness of your credit and additional costs.
8. Purchase Order Financing
A common issue that arises among all startup owners out there is they don’t have enough cash to create new products on a fresh big order. In such a case, Purchase Order financing firms can help you out. These organizations give funds to the suppliers, thereby finishing the deal and benefiting your startup.
9. Factoring Accounts Receivables
This method is very much similar to Purchase Order Financing. The only thing that makes Factoring Accounts Receivables unique is they apply to all the due amounts not received from purchasers. For startup owners that are looking to expand their startup in a short time, this method is fruitful. Also, it won’t take too long.
10. Investment Retirement Account
Last but not least, we have an Investment Retirement Account. The method is quite accessible to all startups owners in today’s competitive time. In this process, several individuals who trust you fund your startup for a particular duration. You can reap lots of benefits from this business funding method.
So, in this article, you have seen some creative methods to get funds for your new company. I haven’t spoken about angel investments, startup incubators, etc. because they can take a lot of time for new startups. They analyze your startup thoroughly and come to a fair decision after a long time. You should know that a delay can kill your chances to live your startup dream. Many startups failed just because their owners failed to make them survive with seed capital in the market. Also, the market does not favor some businesses. Lastly, I will like to say you should follow these creative methods to start and grow your business as early as possible.