By Hunter Hoffman, Head of US Communications Hiscox Small Business Insurance
The spark of inspiration, that great idea, the beginning of many small businesses, but it takes money to turn that idea into something. Where there are many good ideas without capital, they need to be turned into reality. Sixty-five percent of small business owners believe that it is difficult to find funding for a new business, according to Hiscox The DNA of an entrepreneur Study.
Raising startup capital is one of the most difficult parts of starting your business. Here are some tips to help you raise funds to make your small business a reality:
1. Find some angels.
Most of the successful entrepreneurs you see on TV start from where you are now – they had an idea and they need capital to make it a reality. Contact people in your network to help get funding from people who were once in the same position. Talk to everyone you know until you get a positive response or referral who can actually help you.
Angel investors are a great resource to help get your idea off the ground, if you can get their attention. These are generally recognized investors with a net worth of at least $ 1 million who invest in a variety of start-up businesses and concepts. This does not mean that they will throw money at any crazy idea – they pitch all day and choose only a select few companies to invest in. Make sure your elevator is tight and be prepared to answer all difficult questions about why. Your idea is worthy of their interest.
2. Follow the wisdom of the crowd.
Crowdfunding for small businesses has expanded fundraising opportunities for entrepreneurs. However, awareness of this option is low, with 92 percent of small business owners voting in 2014 The DNA of an entrepreneur Study does not consider it as an option. Sites like Indiegogo and Kickstarter are a great tool for enticing potential investors to send money your way. All you need is a compelling argument and you can start crowdfunding your small business idea. Strange and innovative ideas may work well here (someone raised more than $ 55,000 to make the perfect potato salad earlier this year) but it can be even more difficult to go through the chaos of a more general project.
3. Open your piggy bank.
Tapping your savings to finance your new business is the easiest way to get your business off the ground, but if you don’t have the money, it won’t help. The good news is that you can grow your business and reduce the risk without having to keep money in the bank. Many successful entrepreneurs have started their business for some time – even a few years. . You will light candles on both ends, so burnout is a real problem, and your growth will be slow, but it is possible. Get a job and focus on your business full time and in complete control without any outside investor.
It’s important to make sure your story is together with the necessary documents to show that you are not just dreaming, regardless of the source of the money. The more prepared you are, the more likely you are to get others on board and help make your dream a reality.
Hunter Hoffman is the head of US communications Hiscox Small Business Insurance And responsible for media relations, social media, internal communication, and executive messaging. Hunter lives in New York City with his wife and two sons, Walker and Otis. In his spare time, he showed the moon as Juniors Fresh, a fresh baby and toddler food delivery service and cafe in New York City, founded by his wife Michelle, as chief marketing officer and deliveryman.