Have you ever fantasised about escaping from your corporate lifestyle? After all, we have all been in that situation where we sat idly in our cubicles and fantasised about starting a lawn-mowing business in Hawaii before a mountain of analysis reports brought us back to reality. In addition to having a way to sell a product and a product to sell it with, starting a business requires one thing above all else: money. Relax! We got you.
Ways to Improve Business Productivity
If you are still reading, we kid you not. These top ten strategies will improve your business productivity by 100X. Let us see how to fund your business to increase productivity.
1. Secure Bank Loans
Most small businesses have always started by securing a bank-approved loan, allowing borrowers to rest assured that their funds come from a reputable and approved source. However, this procedure has become increasingly challenging over the past few years. No legitimate financial institution would lend to someone unable to make their payments on time.
Additionally, you will need to provide collateral in the form of an insurance policy to the bank. You can only start if you own real estate, vehicles, or other investments in your name or the businesses. Your cash flow statements should also look good if you are already operating and generating revenue. Every company has problems from time to time, but you need more money to run the business daily to pay back loans.
2. Use 401(k) and Pension
If you’ve been working for a while and have begun making significant contributions to your 401(k) and pension pot, consider using these funds sooner rather than later. Establish a specific type of company and adopt a specific type of retirement plan to shorten complicated and time-consuming legal proceedings. The remaining funds are then rolled into this plan and exchanged for company stock. Sounds easy, doesn’t it?
In the event of a joint venture, you can divide the risk among yourself by combining the pensions of other individuals, such as friends or family.) Naturally, the most obvious disadvantage is that your retirement savings are gone if your business fails. As a result, you should put only some of your money into investments. It is also simple to get in trouble with the taxman.
3. Consider Crowdfunding
Seeking assistance online can be a potentially profitable option. Even though thousands of other potential entrepreneurs are vying for the same hard-earned money, your company will need to pique people’s interest. You’ll also need to entice people with the promise of smaller rewards based on how much money they give.
4. Look for Angel Investors
Angel investors are the financial backers of Shark Tank and Dragons’ Den. They offer investment and expertise in exchange for a stake in the company. You don’t have to give a presentation on national television to get in touch with angel investors; however, the less public process of obtaining their assistance is just as intimidating. Like in TV, being completely prepared is the key!
Angel investors are more concerned with your market research, business plan, and the viability of your valuations and projections than with the product itself. Don’t try to trick people or lie as they run background checks; you’ll probably end up with eggs on your face.
On the other hand, you should avoid falling for the first investor who approaches you. Investment offers will naturally come your way if your business proposal is strong enough; Don’t just focus on the numbers; also, think about your angel’s industry knowledge and how you’ll work together.
5. Compare Angel Investment vs Venture Capital (VC)
The primary distinction between the two is that the former involves working with an individual, whereas the latter involves dealing with fully established businesses independently. This immediately provides a completely new perspective on your success strategy.
Accountability is the greatest obstacle. Additionally, there is a benefit: Although they will expect you to be at a more advanced stage in the startup process, venture capitalists and equity houses can offer significantly more capital and stay with you for a significantly longer period to complete their investment.
6. Get Grants and Financial Assistance
You may be eligible to receive a variety of government and privately supported funds. The most important thing is to study. For instance, the European Union hosts several funding programs and assists businesses whose products or goals are compatible with their policies and interests.
7. Look for Non-Bank Loans
Numerous private lenders are willing to support businesses, both online and offline. Your company should have been legally operating for at least a year and have a minimum annual revenue (not profit) of between $50,000 and $200,000, although each lender will have its own requirements.
Additionally, they may establish minimum and maximum lump sum amounts you can apply for. This method has numerous benefits and drawbacks, the most obvious of which is the lack of security provided by major high-street banks. Furthermore, there is no assurance of who will acquire your loan if your lender goes out of business. Due to the prohibition of contentious “exit charges,” interest rates are less favourable than previously. But on the plus side, you’ll get personalised service and interest rates that are still competitive with banks.
8. Sell Your Assets
If you’re putting everything into your business and it’s a full-time job that makes money, it might be worth looking into what you can sell. However, we recommend doing this again if you are certain of receiving a return. Putting your assets into your business is a last resort because, for example, the consequences of losing your house are too bad to consider. Be prudent and ensure you know exactly what you’re doing before taking this route.
9. Invest Your Salary
The paycheck could also be your initial investment. You may need to cut back on some of your spending elsewhere; however, if you can set aside a certain portion of your salary to cover business expenses, it becomes a risk-free investment strategy. However, it is the safest way to get things started and one of the most important ways to show potential investors that you can make a profit.
10. Get a Side Job
In a similar vein, if you need more money in your main paycheck or aren’t willing to cut back on your spending, a side job can give you the money you need to start a business. There are many platforms to advertise your services as this mode of operation gains popularity. Naturally, these are only some ways to fund your company; You can look into several accounting and trading platforms, such as Crypto boom, or you can simply ask your friends and family for money!
It is not productive to secure a $500,000 loan if you intend to walk away after three years, just as it is not productive to make a million-dollar profit if you have agreed to give an angel investor two-thirds of that amount.
There are dozens of business options in the world supported by the federal government and the states, particularly in areas where growth is essential, such as STEM businesses. If your business is in a market that is important to the economy, look around to see what you can get; You never know when you might need money. For instance, look at our shared strategies to improve your business once you secure the money. Hopefully, some of these will rescue you from boring cubicles!