How often have you thought about starting up your own business? Perhaps you have a dream to follow, or maybe you just fancy having more flexibility in your working life. Although it’s hugely exciting, the financial implications of starting a business can be a little intimidating. You may have heard talk about seed funding and angel investors and be feeling out of your comfort zone. But it doesn’t have to be that complicated- you can get your business off the ground with a few simple steps.
Add-In Your Savings
Have you considered the idea of putting your own savings into the business? If not, why not? If you do truly believe in your business and you’ve done your market research, you should be convinced enough that it will work to take a chance. Trading off equity for money at the beginning means less control over the direction of your business, so it’s best to minimize it anyway. If you have some savings to add-in, you’ll need to do this less, and it also shows investors that you have faith in your ideas.
Find A Specific Lender
If you’re having trouble convincing a bank to make a loan to you, you may not know that there are some industry-specific funding routes available. Services like www.4bsf.com allow you to access business capital based around the industry that you want to work in and can be a great source of support when you’re just starting out.
Minimize Costs To Bare Minimum
A lot of new business owners fall into the trap of convincing themselves that they need to spend straight away on things that really could wait. Get into the habit of questioning yourself before you make a purchase. Do you really need to splash out on a logo design before you’ve even made a sale? And why hire office space if you can work from your spare bedroom? Source any equipment you use pre-used as well. You can always upgrade once you’re making more of a profit.
Keep It, Professional
Everything you do financially when it comes to your business has to be done professionally. Start as you mean to go on and you won’t be storing up mistakes that are hard to correct later. For example, if you end up borrowing money from a relative or friend, don’t just do it on a handshake. Make sure there is proper legal documentation in place, signed by all parties. Create a formal agreement on interest rates, repayment schedules, and all other details and put it all in writing. Stick to this like the letter of the law – always make payments on time, even among family members. This is creating better business habits that will benefit you and establishes your trustworthy business reputation.
Build Great Relationships
Strong relationships are at the heart of the business – with your customers, with your suppliers, and especially with your creditors. Prepare income statements and supply them on a regular basis, share your financial projections with your lender, and communicate any problems early. What you are trying to do is establish trust – once that’s built up you are likely to be extended more credit or given favorable terms next time.