How to get startup funding for your business
Startup funding for a business is a difficult venture.
You’re a startup business and are finding it difficult to get off the ground. You also believe extra funding could make running your business a lot easier. Since you’re a startup business it may be hard for you to qualify for a loan. So what other choice do you have?
Startup Funding: What is crowdfunding?
Crowdfunding is the opportunity to reach millions of potential investors, defying the convention of asking a few people for huge sums of money. Instead, you can seek a large number of small, low-risk investors.
In the past, if the bank rejected your business loan, it was game over for you as a startup business. Well, things have changed, as crowdfunding allows you to publicise your innovative ideas to the world, putting you in touch with the people who truly believe in them.
Startup Funding: Raising funds efficiently
At the start, organically finding many people to become investors for your startup business can be hard, tiring and costly in itself. With crowdfunding a lot of hassle is removed, if you can find a few key investors to create that initial momentum the crowd will engage and potentially invest. You can get your startup business noticed instantly because of crowdfunding, hopefully increasing the number of investors.
Startup Funding: Thought it all the way through?
A good thing about crowdfunding is that the potential investors are able to critique your idea, as they can find any issues that you may not have looked into, or help you decide whether the business idea could even be successful. After investors finish poking holes in your business idea, and there are still a lot of investors interested in the business, there’s a good chance that your business will be successful. The feedback from the potential investors is an opportunity for you to make your business idea as impermeable as possible, and possibly better than the initial idea.
Startup Funding: Investor help
Apart from investing in you and critiquing your business idea, investors can help you out. How?
Well, investors are able to engage with you, so they are able to express what else they can offer you. Certain potential investors may be able to introduce you to other businesses that may make your product or service cheaper to produce.
Startup Funding: Pretty much everywhere.
Want to know what crowdfunding is good for?
Media exposure is great for getting your crowdfunding campaign noticed. Which is great because it provides awareness for potential investors that are ours outside your network and new customers. Blogs, articles and publications by people of influence are examples of the type of media coverage that you could attract by crowdfunding for your business.
Startup Funding: Social Proof
Running a great campaign attracts potential customers who may express interest in your idea. This is how you as a startup business get social proof. Social proof is a positive as it shows how much faith people have in your business idea.
For your business idea the great thing about social proof is that it has a snowball effect because once some of the prospective customers show confidence and validate your business idea, more people are likely to follow the trend.
This social proof can be converted into traction, this is when people are interested in what your business idea is, and how your business is doing. Business/Tech blogs may write articles about your business idea, which could increase your valuation. Increasing the valuation could be a major key to convert on the fence investors. Subsequently, also attract investors that you wouldn’t have immediately attracted otherwise.
How to get startup funding for your business: Our Conclusion
Crowdfunding is a suitable alternative for businesses trying to raise funds to grow and or develop an idea. Especially when loans are difficult to qualify for and often have high charges attached to them. It’s a great way to raise money to make your idea as high quality as possible. Crowdfunding gets your business idea out there and see how much people are attracted to your idea.
Do you need crowdfunding support?
We can help. Drop The Crowdfunding Studio are proud partners of Crowdcube and Indiegogo. We assist ambitious businesses in communicating their ideas, with outstanding crowdfunding video production, campaign design, crowdfunding marketing, PR and more.
To learn more about us and our services, visit our website: drop.studio
Or book a free phone workshop today and ask us anything, like how to create a successful crowdfunding campaign or how to accelerate your business from zero to fully funded.