How to Get Funding and Grow Your Brand
Starting a business is not easy. You must have a good idea for a product or service that will address a specific market demand. After that, you must secure the necessary funds to bring your concept to reality and grow your brand.
The latter is often the most difficult. Indeed, many ambitious startups lack the essential resources to get started. Fortunately, businesses have several options to consider:
Start with Crowdfunding
The first option is to use crowdfunding to get others to invest. This strategy has the potential to be profitable, with strong growth prospects and a high return on investment for investors. Because it does not require a minimum amount of cash and is less restrictive than an IPO, it remains the most simple and accessible form of fundraising.
Crowdfunding, or participatory financing, is a solution that allows entrepreneurs to collect the financial contributions necessary for the creation or development of their business, ranging from € 2,000 to € 8 million. People invest money in the companies of their choice in exchange for business or financial rewards. There are several forms: donation with or without consideration, loans, or subscription of bonds or shares.
Reliable Financial Institutions
Resorting to specialized organizations is another potential choice. In each country, there are public and private organizations and investment banks whose mission is to finance the development of private companies under certain conditions (profitability and viability of the project, nature of the project, amount of financing, etc.) This financing takes the form of low-interest loans, sometimes guaranteed by the state, which helps companies finance all or part of their development project. For example, organizations specialize in funding research and development projects, supporting prospection activities, or acquiring production equipment.
In developing countries such as West and Central African countries, other specialized mechanisms exist for SMEs in need of financing to grow. These programs are generally financed by international institutions such as the World Bank, the IMF, the European Union, or USAID. From 2010 to 2019, millions of dollars were injected into private sector companies by these different institutions through development projects.
Either way, there is no shortage of financing solutions for companies to consider.
Sweet Tips from Ally:
Nowadays, with the rise of globalization, there are many funding methods for SMEs. Depending on the direction of the business, SMEs should do detailed research to pick the best one. Here are potential options for your funding plan:
- Bootstrapping (refers to when an entrepreneur starts a company with little capital, relying on money other than outside investments)
- Loans from friends and family
- Credit cards
- Bank loans
- Angel investors
- Venture capital
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