Posted on Sunday 30 September 2018
One of the greatest hurdles in building a business is capital, or lack thereof. Pure lack of capital and financial resources, subsequently pushes aspiring entrepreneurs to believe that borrowing money is their only option. Of course this is pretty accurate but there are other ways. The pitfalls of going into debt are well-documented, but thankfully, other alternatives do exist.
Many ambitious and aspiring entrepreneurs aim to open their businesses as soon as possible. Often starting up while still living at home with their parents. There is a certain excitement which often comes along with building a brand and starting a company.
However, gradually building a business is one of the best ways to avoid going into debt. In many cases, this may require not giving up one's day job until the business venture yields profit. The process of building a business while still maintaining a day job may be initially frustrating and time-consuming. However, with patience, dedication, and consistency, the business will eventually become profitable.
Following the generation of profit, the entrepreneur can then quit his or her day job. Gradually building a business is vastly more effective and beneficial than taking out loans and attempting to do everything at one time. Rome was not built in a day. Also, if you are from the Oakville area in Ontario, then you should check out their local business start up workshops. Some of our staff has heard some great things about them.
Believe it or not, there are many aspiring entrepreneurs who want to go into business for themselves, yet lack critical knowledge. There are so many factors involved in starting a business; a business plan, budget, legal paperwork, website, proper management of funds, and sales tests are only the tip of the iceberg.
Knowing the ins and outs means having a solid plan and being fully informed. So many people who want to go into business for themselves believe that simply borrowing money and spending during times of apparent necessity will help them. This is a common error which often engenders the downfall of businesses.
Hopeful entrepreneurs need to have their budgets in place and know exactly how much financial capital is needed to start their business. Perhaps try talking to your bank for more options.
At the end of the day, those who wish to go into business for themselves without also going into debt will have to fund their own enterprises. Thankfully, there are a variety of ways in which aspiring entrepreneurs can go about self-funding.
Simply saving money is an option, although it can be time-consuming depending on the individual's income and the costs of starting their business and it can be hard to balance the needs of the business with other demands like paying for college. In some cases, funding an enterprise purely through one's own funds can take months, if not years, although it can still be done.
Each hopeful business owner will have to decide whether or not this particular avenue is right for them. However, saving money to fund one's business is not the only option. Hopeful entrepreneurs can also consider pitching to an angel investor.
Angel investors can be incredible assets for aspiring business owners, however, there are certain stipulations. True passion for the business, a solid execution plan, and awareness of the market are things which angels will look for before investing their money into a business. Always think long term when buying anything.
Starting a successful enterprise is a tough venture. Starting a successful enterprise without going into any debt is even more challenging. However, with the proper preparation, knowledge, and expertise, it can be done.