Keeping a business afloat takes time and practice. Unfortunately, not all companies, no matter how great their service, manage to survive. And current world events such as the Covid-19 pandemic have made keeping in the black even more challenging. But as dismayed as you might be at the prospect of folding your company, there are always avenues you can explore.
Borrow Small Amounts as Required
Money lending is nothing new, and if done responsibly and reasonably, can be a lifeline in difficult times. Business loans are usually available should a bank or lending organization rule in your favor. Depending on your requirements and how much you need, you will need to propose a detailed plan so any lender can get a clear picture of how much to lend and if you can repay.
Installment loans are the most common type of loan. These require you to pay a small amount of your total owed over a set period. The amount owed is divided by the period. For example, a $10,000 loan might be agreed over 24 months at $833 per month, plus interest. A responsible lender will never arrange an unreasonable repayment plan.
Consider Crowdfunding
A trending method of securing initial or extra funding these days is crowdfunding. Some successful businesses have been started with crowdfunding. Oculus Rift VR and MVMT Watches are prime examples. Others have been saved, including City Lights Books that was hit hard by the pandemic, and Sunny’s Bar which was destroyed by Hurricane Katrina.
Platforms such as GoFundMe and Kickstarter are some of the best examples of crowdfunding. However, there are some things you need to be aware of when sourcing funds this way. There are two types of crowdfunding – investment-based and loan-based. Investment-based means that investors hold shares in your business but don’t require paying back. Loan-based investment needs to be paid back to investors with interest.
Impress the Investors
Further, investors can be a huge help when it comes to business. Famous capitalists like Sir Alan Sugar, Donald Trump, and Elon Musk can provide cash injections to save a company or get it off the ground. Investors of this type are beneficial because they provide much-needed cash flow and bring with them an army of experts in marketing and management.
However, such angel investors are hard to impress. That being said, you can raise investment potential and interest in numerous ways. Online crowdfunding is one example of finding investors. However, you can find them by attending investment events like WebSummit and Collision or launching social media campaigns. Once found, you need to impress investors. This is the tricky part, yet it isn’t impossible; work on your pitch, know your product or service inside out and make the benefits of investment clear.
Research Available Grants
Loans and investments aren’t the only methods of securing funds for your business. Many nations make help and support available for new companies and struggling ones alike. For example, the Covid-19 pandemic has caused untold misery to millions of businesses all over the world. However, the US and UK governments are just one example of nations that provide support plans for the worst affected companies.
Additionally, other examples in the UK include the Kickstart scheme, Seed Enterprise Investment, and New Enterprise Allowance. The United States also offers similar grants such as the Women-Owned Small Business contracting, eBay Up & Running grants, and the Amber Grant Foundation for female entrepreneurs. There is always financing available, you just need to take the time to look for it.