Studies show that roughly 20% of new small businesses fail within their first year and a major factor in their failure is a lack of funding. It’s no secret that all businesses require money to operate and achieve their goals. But did you know you can acquire funding in non-traditional ways?
There are many different options, both traditional and non-traditional, for obtaining the funding you need for your business needs. Traditionally, founders take out bank loans, apply for government grants/loans, or look for investors. But few people think of crowdsourcing, partnering with someone who shares your vision, or bootstrapping as options to achieve financial success.
Read on to discover alternative ways for you to raise funds for your startup and make it past your first year of operation.
There are lots of creative ways to fund your startup or secure the capital it needs to develop and commercialize new products, reach new markets, grow and scale, and more. Here are just a few:
- Qualified Opportunity Zones (QOZs): In my opinion, QOZs just haven’t lived up to their promise. In addition, navigating funding through QOZs can be tough.
- New Market Tax Credits (NMTCs): This is a great program but it is highly competitive and it is really only ideal for certain types of companies or projects.
- Reg A+ Funding: This is one of MY personal favorites. With Reg A+ you can raise up to $75M per year, with less hassle and giving up LESS equity than some of the other traditional private investment approaches.
In any case, these are just a few examples. Talk to me if you would like to learn more about these or other programs!
Looking for alternative startup funding sources other than VCs or angels? There are several options such as loans, credit, points, grants, incentives, contracts, government programs, and private sector resources.
Bootstrapping a startup refers to launching the enterprise without external funding. But for most founders, bootstrapping a startup really means launching without seeking venture capital, angel investors, or other types of investment capital.
Important Industry Happenings
- Struggling To Get Investors? 13 Alternative Ways To Raise Money (via Forbes)
- Best Crowdfunding for Startups (via Business.org)
- 8 Grants For Women-Owned Small Businesses You Could Get In 2021 (via Merchant Maverick)