Many entrepreneurs are confused about how to fund their startups. There are many consultants you can hire and books you can purchase about this subject. It is complicated and the rules vary, based on a number of different factors. However, if this is the first time you are encountering this issue you need the help of a business financing company that has received countless of positive online reviews, Radium2 Capital is here to help you. here’s five important things about funding to bear in mind:
1) Alternative Funding Options are Well Worth Considering
From equity based crowdfunding to peer to peer loans, commercial mortgages, online flexible loans and invoice financing, there are numerous alternative funding options available outside the conventional banking system. P2P (peer to peer lending) platforms, for example, enable investors to provide small business loans, in return for a competitive interest rate. In contrast, crowdfunding allows small quantities of money to be pooled from several investors, via online portals, with various rewards or equity provided in return. Such platforms are different from conventional lending options, because they are Internet based and eliminate the time consuming process of speaking to a bank manager.
2) Always do Your Research
The way you deliver your pitch to prospective investors speaks volumes about your company’s potential. Investors require direct responses and want you to ease their worries convincingly. If they need to inform you about their concerns, you have not done your research properly. As a startup entrepreneur, you must learn how to instill confidence in investors and overcome obstacles effectively. The investor needs to trust that you can turn your ideas into profit and outshine your competitors.
3) There are Different Types of Investors and Venture Capitalists
Avoid bulk emailing large numbers of investors or venture capitalists. This gives people the impression you are struggling and unprofessional. Identify the investors who are interested in your sector, concept or business strategy. Some venture capitalists specialize in businesses of a particular size, while others focus on seed funding or early stage rounds. Demonstrate your expertise in your field and educate them about it. Most investors are bombarded with inquiries and pitches, so they cannot look at them all. Make them feel as if they will miss out big time (FOMO), if they overlook your proposal.
4) Collateral is Needed for Bank Loans
You must have collateral to get a commercial loan, such as business inventory and receivables, or a personal asset like your home. Banks are not permitted to provide startup loans, unless the startup can pledge assets.
5) Cash Flow is key
Cash flow, or the quantity of cash moving in and out of your business, is a significant factor when it comes to alternative funding. As an entrepreneur, you have to allow for periods where your profits might appear good, but your overheads greatly exceed the incoming funds. By doing this, you will spend money in a more cost effective way and make payments on time.
Radium2 Capital can provide up to $1,000,000 of funding for your company within a matter of days. Our free, straightforward online application offers fast decisions with no obligation. Learn more by visiting Radium2 Capital official website.