The world is flourishing with ideas by entrepreneurs, as beautiful as these ideas may seem, inaccessibility to funding makes the execution of the idea a mirage- Funds nurture ideas.
The implementation of innovations and progression of already existing business depends largely on the availability of finance. Hence, there is a need to spell out appropriate strategies for its acquisition. The growth of businesses especially in developing nations where people have less access to grants is dependent on finance.
There is a common misconception that entrepreneurs have to own a large capital before starting their business. It is true that grants can actually help scale up the business, but the entrepreneurial skill lies in the ability to convert a small amount of the capital to yield a higher return.
Depending on the type of business, most starters often start small, especially if it is a service based business. Entrepreneurs, particularly small scale entrepreneurs are sometimes advised to cut down cost at the start of the business as much as possible. Instead of going for that expensive outlet, why not begin from a more affordable one that would provide the same service as the expensive one. As the business begins to grow, then you may start thinking of expanding your market. Trying to start out rightly big may tend to cloud your sight from seeing other possibilities to make it happen without external funding. The key is to find the lowest cost method to start when there is absence of external funding.
Of all means of financing, the most reliable and potent is the personal source of funding, that is, the personal savings. This is often the initial capital, a prerequisite at the early birth of the business, although it may not bring about adequate expansion of the business. The interest of investors in the business would be quenched if little or nothing is contributed by the business owner. Hence, depositing your own capital to cover the cost of launching will prompt prospective investors to invest in your business. Starting with your own capital will also help prevent huge loss when mistakes happen.
When sourcing for funds, it is important for entrepreneurs to identify the best source that would suit or is most ideal for the present need. Long term funds should not serve short term goals, that is, if fund is needed to cater for a need that would yield within two months, then entrepreneurs may want to source for funds through overdrafts, family and friends. Family and friends can help with the little they can provide coupled with your personal saving. It is not until you receive a big grant before you can take a small step which will accumulate to a big difference in the business.
Some entrepreneurs tend to overlook the importance of having a sound business plan. The business plan speaks for the business. It gives an overview about the business by projecting the entrepreneur’s vision, the mission of the business. Your business plan may be the important tool that would link you to potential investors, it serves as a proposal tool for application for loan or facility. Business plan gives the investor an in-depth knowledge about the business and may also help you to establish confidence in the investor. Hence, it is important for entrepreneurs to design a sound business plan which may be what you need for that big success.
Entrepreneurs may also want to consider the idea of strategic partnership, partnership does not mean selling your idea to someone, and it is simply collaborating, pulling resources together. This helps a great way than sole funding.
Furthermore, finding the right client and working on the client helps to expand the market. It involves the selling skills to convince the client that your service or product is worth paying for. The right client may be from your network, which is why it is important for upcoming entrepreneurs to expand their network and pitch their ideas to the network. In practice, entrepreneurs raise funds from multitude of sources, the idea is finding the right source that is tailored for your type of business without running into debts.
The implementation of innovations and progression of already existing business depends largely on the availability of finance. Hence, there is a need to spell out appropriate strategies for its acquisition. The growth of businesses especially in developing nations where people have less access to grants is dependent on finance.
There is a common misconception that entrepreneurs have to own a large capital before starting their business. It is true that grants can actually help scale up the business, but the entrepreneurial skill lies in the ability to convert a small amount of the capital to yield a higher return.
Depending on the type of business, most starters often start small, especially if it is a service based business. Entrepreneurs, particularly small scale entrepreneurs are sometimes advised to cut down cost at the start of the business as much as possible. Instead of going for that expensive outlet, why not begin from a more affordable one that would provide the same service as the expensive one. As the business begins to grow, then you may start thinking of expanding your market. Trying to start out rightly big may tend to cloud your sight from seeing other possibilities to make it happen without external funding. The key is to find the lowest cost method to start when there is absence of external funding.
Of all means of financing, the most reliable and potent is the personal source of funding, that is, the personal savings. This is often the initial capital, a prerequisite at the early birth of the business, although it may not bring about adequate expansion of the business. The interest of investors in the business would be quenched if little or nothing is contributed by the business owner. Hence, depositing your own capital to cover the cost of launching will prompt prospective investors to invest in your business. Starting with your own capital will also help prevent huge loss when mistakes happen.
When sourcing for funds, it is important for entrepreneurs to identify the best source that would suit or is most ideal for the present need. Long term funds should not serve short term goals, that is, if fund is needed to cater for a need that would yield within two months, then entrepreneurs may want to source for funds through overdrafts, family and friends. Family and friends can help with the little they can provide coupled with your personal saving. It is not until you receive a big grant before you can take a small step which will accumulate to a big difference in the business.
Some entrepreneurs tend to overlook the importance of having a sound business plan. The business plan speaks for the business. It gives an overview about the business by projecting the entrepreneur’s vision, the mission of the business. Your business plan may be the important tool that would link you to potential investors, it serves as a proposal tool for application for loan or facility. Business plan gives the investor an in-depth knowledge about the business and may also help you to establish confidence in the investor. Hence, it is important for entrepreneurs to design a sound business plan which may be what you need for that big success.
Entrepreneurs may also want to consider the idea of strategic partnership, partnership does not mean selling your idea to someone, and it is simply collaborating, pulling resources together. This helps a great way than sole funding.
Furthermore, finding the right client and working on the client helps to expand the market. It involves the selling skills to convince the client that your service or product is worth paying for. The right client may be from your network, which is why it is important for upcoming entrepreneurs to expand their network and pitch their ideas to the network. In practice, entrepreneurs raise funds from multitude of sources, the idea is finding the right source that is tailored for your type of business without running into debts.