Last Updated on Mar 26, 2020 by James W
Getting the money you need to start a new business can be tough. However, anyone with a good concept should find the cash they need eventually. You just need to draw up a business plan that investors can’t refuse. At the end of the day, there are a lot of people out there who invest in new business. They wouldn’t be able to sleep at night if they missed out on a lucrative opportunity. So, you should aim to present your company in the best light possible. Only then should you employ the following strategies.
Go to the bank
Most people think that getting money out of their bank these days is impossible. That couldn’t be further from the truth. We went through a short period where bankers were less inclined to provide funding, but that’s behind us now. A visit to the bank with your business plan could be all that is required. So long as you’ve covered all the bases, the manager should be more than happy to provide the capital you need. Banks are in the business of making a profit. If that seems likely to happen with your business, they will want to get involved.
Contact private equity firms
Private equity firms are similar to banks in that you can seek investment. However, that is where the similarities end. You have to give away a certain percentage of your business to gain investment using this method. There are also no guarantees you can get advice and support from the investors. So, it’s a riskier idea, but it tends to pay off for most people. Just know how much of your company you can afford to sell, and watch some Dragon’s Den episodes ahead of time.
Remortgage your home
Remortgaging your property could be a great way of raising the cash you need. So long as you’ve paid the bills for more than a few years, there should be lots of equity within the building. That means you can get a new mortgage deal, and free up lots of money. Just make sure you are 100% confident with your business idea before moving forward. The last thing you want is to increase your monthly bills to fund a failing concept.
Make use of government schemes
Sometimes you won’t need as much funding if you take advantage of government-run innovation schemes. For instance, many new business owners are using the Enterprise Innovation Scheme at the current time. It allows them a tax-free growth and amazing level of tax relief. EIS relief provides 30% upfront income tax relief to those starting new companies. It also reduces inheritance tax by 100%.
Now you know how to fund a new business idea, there should be nothing standing in your way. As we said only a moment ago, getting the money you need is easy if you have a winning concept. For that reason, you should always listen to advice from the experts. If people aren’t willing to invest, there is probably a good reason. So, you might have to take the concept back to the drawing board.