How to get Funding for your business easily!
If you're not lucky enough to have a bucket load of savings or have mum and dad at your disposal, at some point on your money making / business journey you are going to need funding.
Gone are the traditional, one stop banks, where you would submit a business proposal and offer equity in the form of your house, fingers crossed, to hopefully get a yes??
Now we have so many ways to get funding, even if you have a less than perfect credit score!
This is a government backed scheme that help entrepreneurs start a business in the U.K by offering them a 6% loan repayable from 1 - 5 years and offering £500 - £25,000.
Applicants are also offered 12 months free mentoring support.
A lot of these sites have popped up over the last 5 years and have funded thousands of entrepreneurs and inventors businesses.
These platforms work by offering a crowd something in return for funds. It is called crowd funding.
For example I am a musician and want to fund my first album and use a recording studio. I need £10,000 to start so I decided to offer my fans a chance to get their hands on my album for half price if they buy it now on this platform.
These platforms are great for raising funds in exchange for your product or service at a reduced rate.
A platform to share your idea with your crowd and a network of others who will find your idea on return for a product / service / or equity.
Pros
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No credit check or background check needed
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Does not cost anything to start a pitch
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Can be over funded
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Can bring great advertisement to you product or service.
Cons
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Will need to bring a crowd to get the ball rolling. Projects that are partially to halfway funded within the first 10 days of going live are pushed up the ranks on the crowdfunding website, so more people can see it. Some are even shared among the community through the platforms email marketing and adverts so they gain more crowds faster helping you to get funded or even over funded.
Things to look out for -
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You will need to build up a social presence before going live to gain fans or exposure so there is a healthy crowd ready and waiting to fund your project once it is live.
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Do not expect to create a brilliant pitch and the place it on the platform with a lot of people buying up your service or stock (this type of crowd funding does not work like that).
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You will have to share your pitch with friends, family, investors if need be and the like. The more exposure you have the more you are likely to get funded and the more these platforms will share your pitch on their home page and network for others to invest. You provide the crowd not the platform!
Funding circle / Rebuilding Society / Funding tree
These avenues are similar to Kickstarter and Indiegogo but instead of pitching to the general public and your network you are pitching to investors. The people that are giving money have registered to do just that! They are looking for businesses to investing in so your pitch is key.
Most networks only let established businesses pitch, which means you need to be trading for at least 3 years and have 3 years set of accounts at Companies house as well as a credit check done on each director.
We will be offering a consultancy service, which will guide you through your
crowdfunding application. For a better chance of getting accepted visit our shop.
Things to look out for -
-
You will need to build up a social presence before going live to gain fans or exposure so there is a healthy crowd ready and waiting to find your project once it is live.
-
-
Do not expect to create a brilliant pitch and the place it on the platform with a lot of people buying up your service or stock (this type of crowd funding does not work like that).
-
-
You will have to share your pitch with friends, family, investors if need be and the like. The more exposure you have the more you are likely to get funded and the more these platforms will share your pitch on their home page and network for others to invest.
If you are a start up company with no crowd and need funding then try Equity crowdfunding sites.
Equity crowdfunding sites
(Equity crowdfunding enables you to invest alongside a group of people (the “crowd”) in a company that isn’t listed on the stock market, in return for shares in that company.)
Crowdcube.com - has over 295,000 investors ready to invest in early and startup companies in exchange for equity.
Seedrs - A crowdfunding site for start ups and entrepreneurs where the start up company offers equity on their business in exchange for funds.
(We will have more information on how to write a winning pitch, and how to create a pitch video for less than $30 here soon, sign up to our newsletter to be the first to know when this is available).