Establishing a start-up is acritical and crucial decision because many are resistant to change. Newton, in his famous laws of physics, explained a concept known as “Inertia” and that it is the inherent property of every object to resist change. The same concept can be applied to a start-up ecosystem wherein one may have a billion-dollar idea but may not come forward due to lack of investors and investment, hesitant to leave behind a high paying secure job, and tread into the unknown, and lack of a support system among many.
It is certain that having landed on this site,you may want that gentle push to overcome the “Inertia,” and we would like to provide the support system and a little push to turn that idea into a profit-making company. Find a way to get started in the following sections.
Tips to Raise Capital
Many entrepreneurs tend to self-fund or bootstrap their start-ups to avoid debt or sharing equity. However, it is a known fact that money is the backbone of any business and that it is hard for any business to be profitable in the initial years. Therefore, with money getting drained at one end and the business trying hard to break even, entrepreneurs are left with the question of shutting down their business or raise more money and how. Here are a few tips for raising some capital to keep the business going.
- Approach Angel Investors
These are people with excess cash and an interest in new business ideas. Usually, they listen to business ideas and proposals and may provide advice. Many big giants today were funded by angel investors during their early stages.
- Get Funding from Venture Capitalists
These are professionally managed funding organizations or a set of individuals who provide capital investment until the company is ready to go public. They provide mentorship and expertise in the management decisions of a business.
- Approach the Government
In India, the Government of India has started the Startup India campaign to provide capital investment to start-ups and help them grow. The idea needs to be presented to a panel of experts, and if found promising, the funds would be released on an incremental basis with progress.
Apart from the above three primary sources of funding, entrepreneurs can even try Crowdfunding, Bank Loans, Business Incubators, and Families to raise capital.
Why Start Your Own Business?
- To See Your Idea Become Reality– In a regular 9-5 job, maybe a high paying one, you usually work to change another individual’s idea into reality. Why not instead work towards turning your idea into a reality? The joy can only be experienced, not explained.
- Take Control of the Business–With your own business, you get to make and manage decisions that are right for the business, set the guidelines, set rules for the business, hire according to the business goals, set the culture of the business, and work flexibly among many that could be done in a typical 9-5 job.
- Control over Money– Having your own business will give you full control over where and how the money circulates. Pumping where funds are required, and vacuuming where not required is entirely at your discretion.
- The Joy of Providing–Owning a business requires hiring employees, which in turn means supporting their families too. You can also set aside funds for noble causes and to venture out into new domains.
- Meeting New People – Managing a business requires meeting new people with proposals and venturing out into new societies with the company’s products. It allows the owner to meet some talented and professional people and make new friendships that might come in handy in the foreseeable future.
The above points are a few motivational tips among many to start their own business and grow in this competitive world.
However, even with all the above tips and motivation, setting up an own business is easier said than done due to societal pressure and family pressure, insecurity, high competition in the industry, and acceptance by the target customers, to name a few. Still with start-ups come up due to the perseverance of the founder(s). The key is to target a niche segment rather than a broad segment where the presence of giants can be found along with increased competition or to target an untapped segment altogether.