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Five Different Types Of Funding Option For Your Business

| Published on March 16, 2020

Every other person in India is Gyaani (intellectual). He/She can easily tell you all kinds of lucrative business ideas but, when you ask him/her, why aren’t you doing such a great business in your life? He/She will say, Bhai, paisa nahi hai (Buddy, I don’t have money).

But actually, there is no such thing as lack of funding. If you have a solid business plan, then the world of investment is open for you.

Now, immediately, you will say, I don’t even have money to start a business.

Well…Let’s start. Today, we will discuss five different types of business funding options.

Bootstrapping

Bootstrapping is the process of launching a business using only existing resources, such as personal savings, home space, personal computing equipment, and garage space. Well, now if you say, you don’t even have that but only have a business plan, then just wait for few months, start a job, earn some money, and then launch your business.
Can’t wait for six months? Here are other options to get immediate funding.

Crowdfunding

Crowdfunding is a simple process of raising funds for your business from family, friends, relatives and small individual investors.
Isn’t anyone willing to fund you? No worries. Check out options below.

Bank Loans

We all know that Modi Ji loves entrepreneurs and businessmen. So, Don’t worry! If nobody believes in you but you have a solid plan, apply for a Mudra Loan. You can get sufficient capital to launch your business. And if your capital requirement is more, then the bank also has the option of working capital loan and funding.
So these were the three ways for those who want to build a business from scratch. Now comes to the funding options for existing businesses who aren’t able to grow because of stagnated funds.

Venture Capital

Venture Capital is one of the most sought after ways of arranging funds. Many well-established startups arranged funds from Venture Capitalists. But who are venture capitalists?

Venture capitalists are employees of venture capital firms who invest other people’s money into companies and in turn expect a return on their investment. You don’t have to pay back the money as in the case of banks, but have to give a fair share of your profit. Venture capitalists make sure the business they are investing in succeeds as they have invested other people’s money.

Angel Investment

Angel Investors are the people who are seen as God by people who need funds for their business. These are rich individuals who invest in small high-risk businesses which have the potential to grow. An angel investor views the proposals before investing and invests in your business in exchange for convertible debt or equity.

So what option do you prefer choosing for your startup/business? Let us know in the comment section below. And to know in detail about any type of funding option, comment in the box below.

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