8 Tips for Funding Your Small Business

As long as the old saying, “You have to spend money to make money” holds true, small businesses will need funding for startup or expansion costs. But getting that funding is often easier said than done.

Where do you turn for money? How do you improve your odds of obtaining funding? These stories and tips from members of the Staples® SUCCEED: Small Business Network on LinkedIn will give you ideas for how to get the funds you need to grow and maintain your business.

01. Obtain a Business Line of CreditTip:

A bank may well turn you down for a small business loan if you haven’t been operating for at least two years. But if you don’t need a lot of money, you could still qualify for other bank funding, as SUCCEED member and entrepreneur Robert Cozzone discovered:

“I started by opening a business checking account

with $500 and applied for and received a $25,000

line of credit.”

02. Trade Services in Lieu of Funds

Tip:

What would you do with the cash if you received funding for your business? If it would go toward paying vendors, you might be able to use a system much older than money: barter.

“I bartered with others to get some early-on systems in place

(graphics, Website, social media).”

- Seana Turner, Founder at The Seana Method, SUCCEED Member

03. Ask Customers and Potential Customers to Fund Your BusinessTip:

If you have a service-based business, try asking clients to pay in advance for services to come later. For example, offer discounts if clients will pay for a month’s worth of services upfront; you’ll be able to purchase tools and get your business up and running with that capital.

04.Look to the Crowd

Tip:

By pre-selling your services or demonstrating viability for investors on a site such as Fundable, you may be able to crowdfund your way into business and launch without going into debt. Dawn A. Harden, SUCCEED member and professional writer, editor and social media consultant, says that the key is to “try crowdfunding if you can demonstrate credibility and value-added services.”

05. Go Where Startups Are Nurtured

Tip:

“Look for startup events in your area, such as StartUp Weekend. This will give you face-to-face opportunities with potential investors and team members to help you launch your idea,” says SUCCEED member and business development consultant Brian Duvall.

You also could explore applying to startup incubators in your region — these incubators provide entrepreneurs with advice, mentorship and funding tips, and often a bit of capital as well.

06. Ask Family or Friends for Help

Tip:

Here are 3 recommendations for accepting investments from family and friends the right way:

1. Be transparent. Disclose everything the investor might need to know about your venture.

2. Document everything. Keep a secure folder of all emails and documents pertaining to the investment.

3. Make sure the investor is aware of the risks. If your friend or family member is not prepared to lose the money, don’t let him or her invest it.

07. Connect with the AngelsTip:

How can you find an angel investor for your small business? SUCCEED member and virtual office support worker Tammy Durden says it’s all about who you know:

“I think that the best way to get ‘angel’ investors is through contacts,

connections and networking. At least, that is what happened with

me. Relationships will always mean more than the digital technology

relations. We have to sometimes get out of our comfort zones and ask

our contacts if they have connections that could help us.”

In addition to reaching out to your own contacts, you also can check out AngelList, a platform for investors and startups to connect.

08.Prove Your Worth

Tip:

In the end, obtaining funding is all about proving to investors that you’re ready for business. SUCCEED member and Fermi National Accelerator Laboratory community board member Ellen Huxtable says:

“You need to prove to investors, whether private or in the

banking system, that you have the capacity to repay the

loan. Personal collateral, a track record of success and

credentials that demonstrate you have the necessary

skills are critical.”

Make a list of five

specific paths you

could take to obtain

funding for your

business. In the next

30 days, get started

on one of those paths,

using this SlideShare

as guidance.

Advice InspirationActionDemonstrate financial

and business

management skills

and a passion for your

industry to prove to

investors that you’re

ready for business.

“In the business world,

everyone is paid in

two coins: cash and

experience. Take the

experience first; the

cash will come later.”

– Harold S. Geneen

How did you obtain funding for your small business? Share your story in our SUCCEED: Small Business Network on LinkedIn.

Share this SlideShare with a would-be entrepreneur you know to help them with their own funding decisions.

For more tips on funding your small business, check out these additional resources on the Staples Business Hub:

> 4 Tips to Market Your Small Business and Attract Funding

> How Crowdfunding Is Changing the Small Business Landscape

> How Young Entrepreneurs Can Secure Funding for a First Business

> How to Get a Small Business Loan

> SBA Financing 101: How to Get Small Business Administration

Loans or Grants

> 3 Roadblocks in the Way of Your Small Business Loan Approval