Are you still among the class of entrepreneurs whose ideas are still resting in your mind map due to capital? Indeed, funding is still a problem in Nigeria and globally for startup entrepreneurs. But in this series of 3 things holding you back, you will learn how to scale through the barrier of not starting your business.
In the other series, I have discussed this following:
And now I will dwell on:
>> Startup Capital
The first two parts are of this post is necessary that you go through them before you come back for this one. Here is a link to them.
3). START UP CAPITAL.
Many business and valid ideas have died untimely deaths because the owners couldn't get past the "funding stage". I usually think it is very unfortunate. Remember that 25% of startup entrepreneurs fail within their first year, 36% within the second year, 44% in their third year and 50% won’t live to see the fourth year.
Every business that survives must go through this stage, because essentially Capital is a very indispensable factor of production.
Ultimately every Idea needs funding with money at one stage or another, if not for start-up then for necessary expansion.
The problem becomes when the idea doesn't kick off at all on the excuse of "startup capital."
Because you see; any reason why you did not succeed no matter how valid the reason, is only but an excuse.
HERE IS HOW TO GET PAST THAT STAGE.
Have you heard of the word "BOOTSTRAPPING"? That is the perfect idea you should be dealing with by now.
"Bootstrapping" is a term used in business to refer to the process of using only existing resources, such as personal savings, personal equipment, and office space, to start and grow a Business or Company.
The idea of Bootstrapping is to start with what you have without external Help. It involves you raising the money required from your pocket as well as using your personal properties and equipment.
For example your Smartphone and computer are two of the most important tools for an online business today. Your home can be your first office; your personal resources can be deployed towards building a great business and sponsoring an idea.
Note this, over 80% of businesses where started with this method of bootstrapping. Because most of the time nobody believes in your idea enough to give you money for it more than yourself.
To everyone else, including those that have the money to give you, you are a big risk. Nobody wants to lose their hard earned money on an untested idea as yours.
You are usually the first believer in your idea sometimes for a long time. And one way to give your idea a chance is to fund it.
Waiting for funding from external sources puts your dreams at the mercy of others, and trust me, no one is on ground to make you succeed at their own expense.
Everyone is first responsible for themselves.
You are primarily the only chance your dream has to survive and you cannot leave it to chance.
Here are Ideas you should play with when raising money for your business.
Consider the possibility of starting with Zero capital or read about these businesses you can start with zero capital. What and how can you start without having to spend money, what are the personal resources and opportunities available to you? Start with what you have, from where you are.
You think it's impossible because you haven't given that possibility any chances in your thinking mind. Sit down and make it possible on paper then translate it into reality.
Get a Job and raise money to start your business. Your idea is a long term dream; it is worth it if you do something else in order to sponsor it. In the long run you will happy you made that sacrifice.
It will require a lot of discipline in Savings. I recommend you use the “20% business funding theory method". This is where you save a minimum of 20% of your salary to be able to accumulate capital for a new business.
It could also afford you business experience which is another thing you need in your field
Freelance your soft skills and services to raise money for your business. There are several platforms online and offline where you can offer your skills and services for money from Fiverr, Upwork, guru, freelancer, Toptal
Sell something to raise money for your business. Selling is the biggest industry of which all of us are involved. Interesting it is also the fastest way to raise money. Sell something.
Think of what to sell either what you will make by yourself or something you can get at a cheaper price to sell to a waiting and hungry market.
There is something you have experience or expertise in; it may even be related to your idea, an aspect of your business.
In these days of internet it is easy to make a research and discover what to sell. You could sell an information product, a physical product online or offline, Affiliate marketing, Dropshipping.
These are interesting ideas that make your excuse of lack of capital for business nonsense.
Apart from bootstrapping, for “those who have their palm kernels cracked by the gods" the next option for raising money for business is:
From Friends And Family.
These ones believe in you. Something more than you believe in yourself. The money they give you may be entirely free as a way of supporting you hustle or if it is a loan, interest free.
Some of the richest people in the world had the privilege of being helped a lot by their well to do family or friends.
Aliko Dangote Africa's richest Man got a N500, 000 loans from his very rich uncle Alhaji Dantata to start his business. In like manner, Bill gates got $1,000,000 from his billionaire grandfather. Jeff Bezoz of Amazon, currently the richest man borrowed $250,000 to invest in his business from his parents.
The point of all this is that family can be a major source of funding if you are that privileged. For the people who have no rich family, bootstrapping is their fighting chance.
With the rise of Fintech companies, the loaning process is quite becoming less rigorous. Startup entrepreneurs can now get loan without even having to visit the bank. And the beautiful part is that you don’t even need to provide any collateral. However, you need to provide them with your Bank Verification Number (BVN). You can check out the platforms here.
In conclusion, starting a business has become much easier with the rise of technology and data. Today there are myriads of businesses you can start with little or no money. Here is a good example of such a business.
© Adiemea Obed. He is the founder of Next Consulting. A business consulting firm with a proven record in helping SMEs grows. You can reach him