Small businesses and startups are booming, especially in emerging economies. People from all kinds of backgrounds are making it big in entrepreneurship — some in their own small way. This includes even college students and millennials, who are starting early with realising their startup dreams.
Financing the business is always a challenge for small business owners, however. One of the most important things that any small startup will need to thrive is funding. However, if you do not have the right contacts, right valuation or a product viable enough to back, no one is likely to give you their money even if your idea is worth millions.
In any startup, if there are 100 problems, then money can solve at least half of them. Ninety per cent of startups fail within first five years, and the most common reason is the lack of funding. While there are other reasons as well — such as a product that’s not top-notch, or competitor that is way too ahead — most of the time, money is the main issue behind the shutdown of these startups.
There are many traditional ways of funding a business, like borrowing money from your acquaintances such as friends, parents and relatives. But the drawback of these conventional approaches is that 9 out of 10 times your personal relations with these people will go sour due to money. That is why it is better to not go that way. So what one can one do?
Crowdfunding
There are many successful stories wherein people who went this route raised significant amounts of money for their project. Here is a list of 10 top crowdfunding sites on Entreprenuer.com which you can use to raise money, for instance. The benefit with such sites is that if your campaign gets viral, you are very much likely to get funding from big investors, aside from crowdfunding backers. Sites like Kickstarter.com has funded over thousands of projects, but one has to keep in mind that it is not an alternative to long-term or institutional funding. It’s usually best for…