Every good business starts with a good idea. It’s that Eureka! moment where you realize that you’ve got something special that could change the world you live in. Whether it’s a brand new, unique invention or a business based on an already existing idea, you’ve got to have that stroke of inspiration that’s enough to drive you to leave your boring job in the corporate world and start your own business.
If you’ve watched business investment shows like Dragon’s Den or the American version, Shark Tank, you’ll know exactly what I’m talking about. The budding entrepreneurs in those shows have either come up with their own products or are looking to build their own version of a business idea (classic example: restaurants and cafés). Whatever your business idea is, you’re bound to run into your first obstacle as soon as you’ve set your heart on building it: funding.
Unless you’re already an extremely well-established businessperson who has enough money to keep investing in more businesses, this won’t be a problem. But the chances are, you’re not. You’re just a regular person, looking for the right place to start. Trust me, I’ve been there and I’ll be honest – it’s not easy. But if you believe enough in your business, why would you let that stop you? I didn’t, and look where that got me. I’m running my own bail bond business and it’s a success.
I’m no expert, but I’ve certainly learned a lot of things along the way to building my business. From one entrepreneur to another, I want to keep passing on the lessons I learned. Here are 5 tips on how you can fund your aspiring business.
1) Go for a small business loan. When applying for a small business loan, it’s a lot simpler than trying to get a loan from a bank, especially if your credit history is too limited. Collections are automatically withdrawn from your account either daily or weekly, so you won’t feel the pressure at the end of the month. So, from the 10-20% profit I would be getting from my bail bonds, part of it would go to my repayments for the loan. Also, you’ve got to have a passion and a driving force behind everything. I used the fear and anxiety I was feeling from taking the loan as well to propel me forward in my business and also help the community by providing the most affordable bail bonds Lubbock TX has ever had the opportunity of taking advantage of.
2) Get help from a potential partner in exchange for something. Other similar business might be able to help you scale your business if they like your idea. Any amount from them could help you in a big way, even if it means losing some equity. If you make the right kind of deal, you won’t even have to lose that much. You could also exchange an investment for services.
For example in my business, I could have found a partner who worked closely with defendants in criminal cases, such as someone in the Public Attorney’s Office. This way, if a bond agent was needed for someone, I would provide the service in exchange for an investment in my business – so that the investor gets their money back.
3) Plead your case to friends or family. It might be hard to find a stranger who believes in your idea strongly enough to help you out. This could work because those close to you will believe in you without looking for a high return on investment. Of course, this could end badly if something goes wrong with repayments or terms but as long as professionalism is practiced, it should turn out fine.
4) If all else fails, fund it yourself. Use the savings from your current job (if you’re a student, put money aside from your allowance) plus all the loose cash you have lying around and find out the cheapest way you can operate your business. It’ll probably take longer than seeking outside help, but the upside is that the business is all yours.
5) In connection to this, do not overinvest. One of the biggest mistakes you could make as an entrepreneur is to fall into this black hole. Start small; build from the ground up before you throw all your cash into advanced technology systems, overstaffing, or unnecessary inventory. With my business, I started locally with a bail bonds store in Lubbock, Texas. When the gears started to run smoothly, I finally plucked up the courage to expand locations and offer services for El Paso bail bonds and even started operating out of houston as well.
As you can see, there’s no such thing as free money. You’re going to have to work long and hard to get your business up and running. Don’t worry though, you’ll get there. You just need to know what you want so you can plan ahead. There’s no shortcut in this industry so take the right steps to achieve your goals. Pretty soon, you’ll see the fruits of your labor.