The 5 Roads to Funding Your Startup

You’ve had that brilliant idea for a business for years now. Whether it’s the clever app that’s going to revolutionize how we get a date, the vegan taco/pizza/pancake truck, or the self-walking dog leash that scoops the poop for you, you know your idea can not only change the world…but change your life (and your bank account) forever.

Screen Shot 2016-03-15 at 9.27.17 PMBut, then enters the age-old question…”how am I going to pay for it?” Real businesses take real money to get them up and running. Whether it’s hiring an attorney to do patent research, a marketing team to get the word out, or even a design team to help you prototype, an idea will remain an idea until you have the proper funding to turn it into something real.

So, how do you do that? Well, only a few years ago, you basically had two options.

  1. Slog down enough egg nog at the Christmas party to get the guts up to corner your rich, lawyer uncle and “hail mary” your business plan under his nose.
  2. Slap on a suit and march down to the bank in hopes of proving your idea is loan-worthy, even if your car, house, and cats have to serve as collateral.

Fortunately for us, those days are long gone. Welcome to the future of small business funding.

Over the last few years, several options have evolved into legitimate models for acquiring the money you need to get your business off the ground. What follows is a primer on 5 distinct categories of business funding that you can explore, and in some cases, take advantage of no matter your business, your timing constraints, or your personal credit.

Each type of funding has its own advantages and disadvantages, so explore each careful to determine which makes the most sense for your individual situation.

Angel Investors & Venture Capital

Although these two models have their differences, each revolves around the fact that you are offering an investor an amount of equity (a.k.a. a percentage of profits for a certain length of time, even forever) in your business in exchange for an infusion of capital. This describes the kinds of deals you see on Shark Tank. For example, a private investor might offer you $50,000 in exchange for 20% ownership in your company and/or its profits.

The difference between angel investors and venture capitalists is fairly simple. Angel investors tend to be individuals who have a high net worth and invest in companies for fun, profit, and personal interest. This could be the rich dentist who’s bored with golf and sports cars, but wants to help two young inventors from his home state with their new robotic toothbrush. They would create an arrangement where he fronts them a certain amount of money, and in exchange, he receives a return on his investment via the profits they make after expenses.  If they don’t succeed, he loses his money, but the inventors don’t owe him anything (unless otherwise specified in their agreement).

Free Guide: 154 Sources of Funding for Small Businesses

A venture capitalist, however, is less of a hobbyist. She is a shrewd and seasoned investor who chooses investments more on the likelihood of turning a very specific return on her investment. The VC is more focused on making a return over helping out someone for whom she has a soft spot. However, she typically has developed strong business acumen and can serve as a mentor for the young entrepreneur. However, it’s still a situation where, typically, investment is traded for equity and the entrepreneur doesn’t have to pay anything back.

Crowdfunding

This type of funding has come into greater popularity over the last few years with the advent of platforms like IndieGoGo and Kickstarter. Crowdfunding focuses around generating cash via a social campaign. In return, the entrepreneur offers boosters both advance access to the product or service, as well as specific rewards.

Business owners have used crowdfunding to help cover everything from design and building costs to even travel expenses to get their product or service created. At the time of publication of this post, the highest-grossing crowdfunding campaign was the video game Star Citizen, which raised $109,010,029. Yes — that’s nearly $110 MILLION.*

However, it’s not as simple as slapping up a Kickstarter page and expecting generous, anonymous donors to fall into your lap. Successful campaigns often become full-time jobs, with the entrepreneur often employing major marketing agencies to help them plan, create and execute their campaigns. That said, crowdfunding can result in some very serious wins…even into the millions.

Government Loans

Let’s begin by clarifying that although we’re including all Government-related loans under one heading, they’re not all the same.

The major player in government loans is the Small Business Administration or SBA. The irony? The SBA doesn’t even issue loans. Instead, it provides loan guarantees to entrepreneurs and small businesses, issuing a guarantee to the borrower’s bank to pay back a certain percentage of the loan if she/he is unable to do so.

The federal government isn’t just being nice…it has a vested interest in helping small businesses grow and flourish. As a result, the requirements of certain SBA loans are less stringent in terms of the owner’s equity and collateral than commercial loanss. Therefore, this makes the SBA an excellent source of financing source for startup businesses. And in many cases, the SBA will guarantee loans for smaller sums than most banks are willing to lend on their own.

Peer-to-Peer (P2P) Lending

Peer-to-peer lending, often abbreviated (P2P), is a relatively new phenomenon. Instead of going through an institution, a borrower is matched with an individual lender through an online service. These are typically unsecured loans (no collateral required).

This model of lending provides benefits to all parties involved; lenders often earn higher returns than other investment vehicles, borrowers have access to lower interest rates than banks, and the P2P lending company profits through marginal fees on each match they provide.

Frequently, the P2P platform is responsible for checking the credit of the borrower and matching them with the appropriate lending source. Fear not, however, if your credit isn’t in the best shape. There’s a match for everyone; the terms will just vary.

So, Where Do I Start?

Take a good look at your individual circumstances and your ideal situation. Are you willing to give up a small piece of your company in order to avoid the stress of being strapped with business debt for a few years while until you become solvent? Do you have the time and resources to craft a successful crowdfunding campaign?

You have more resources than any other time in history to get the money you need to get your startup up and running. I suggest you take some time to explore different platforms and funding sources to determine which is the best fit for you.

My team has compiled a comprehensive guide called 154 Sources of Business Funding. We’ve compiled as many funding sources as we could find across all styles discussed above, and it’s available to you at no cost. Click here to learn more.

Get Free Access to 154 Sources of Fast Funding for Your Small Business...

Get Free Access to 154 Sources of Fast Funding for Your Small Business...

Keep your business afloat! Get the funding you desperately need...

We’ve compiled an exhaustive list from a variety of reliable sources that can get you a massive investment, loan, equity partner, grant, etc. in record time. Unlock dozens and dozens or resources that are waiting to give you the money you need to GET or STAY in business. Just enter your name and email here, and we'll send you the guide immediately.

Success! Congratulations...you're seconds away from receiving hundreds of sources of funding for your small business.

*https://en.wikipedia.org/wiki/List_of_highest_funded_crowdfunding_projects

 

5 Routes to Funding Your Small Business

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The Biz Funding You Need is in This Guide. Get it Now. Fast...Free.

The Biz Funding You Need is in This Guide. Get it Now. Fast...Free.

Keep your business alive! Get the funding you need...

We’ve compiled an exhaustive list from a variety of reliable sources that can get you a massive investment, loan, equity partner, grant, etc. in record time. Unlock dozens and dozens or resources that are waiting to give you the money you need to GET or STAY in business. Just enter your name and email here, and we'll send you the guide immediately.

Success! Congratulations...you're seconds away from receiving hundreds of sources of funding for your small business.

Perfecting Pinterest: Interview with Beth Hayden

Perfecting Pinterest: Interview with Beth Hayden

Beth Hayden is a nationally-known speaker and social media expert.  She provides master training for NY Times Bestselling Authors, Political commentators, personal development coaches, and more.

Aside from also being a senior staff writer to Copyblogger.com, as well as her site, BethHayden.com she was approached by Wiley Publishing to literally write the book on Pinterest, a new and wildly-popular social bookmarking site.

The book, Pinfluence, is a complete guide to Pinterest marketing that teaches readers how to effectively raise awareness for a brand, product, or service, drive traffic from Pinterest to your website, and connect with current and potential customers.

Interview

Podcast: Play in new window | Download (Duration: 44:31 min — 64.2 MB)


Resources and Follow-Up

56 Ways to Market Your Business on Pinterest
http://www.copyblogger.com/pinterest-marketing/

Beth’s Book on Amazon:
Pinfluence: The Complete Guide to Marketing Your Business with Pinterest

Beth’s Website:
http://bethhayden.com

Beth’s Pinterest Profile:
http://pinterest.com/bethhayden

“Pin It” Button for WordPress:
Pin It button for WordPress

 

Bootstraptitude: Interview with Bijoy Goswami, The Bootstrapping Guy

Bootstraptitude: Interview with Bijoy Goswami, The Bootstrapping Guy

How do you start a multi-million dollar business with only lint in your pocket?

Bijoy Goswami can tell you.  Goswami has been working and researching for years in the areas of bootstrapping businesses and working with other collaborators for the greatest good.  He has since been profiled in BusinessWeek, US News, Entrepreneur Magazine, and Information Week, and has some pretty “big deal” clients and speaking engagements that keep him plenty busy.  He recently sat down with me (Benjy, The SmallBizElevator “Operator”) to chat about the secret to getting a business off the ground, and the serendipitous process of actually creating that business along the journey.

In our conversation, Bijoy and I cover:

  • The differences among “craft” businesses, angel-funded startups, and bootstrapping…and which one is right for each personality.
  • How Southwest Airlines probably wouldn’t be one of the #1 airlines in the world today if they hadn’t bootstrapped through lawsuits, plane acquisition, and passenger handling.
  • How your business can see short and long-term benefits by being open to what you didn’t originally anticipate.
  • What the heck “bootstrapping” actually means, and where the term originated.

 


Interview

Podcast: Play in new window | Download (Duration: 1:09:50 min — 67.1 MB)


Resources and Follow-Up

Bijoy Goswami’s Website:
www.BijoyGoswami.com

Twitter:
@bijoy

or try Googling Bijoy Goswami


 

HELLO, My Name Is: Interview with Scott Ginsberg, The Nametag Guy

HELLO, My Name Is: Interview with Scott Ginsberg, The Nametag Guy

What happens when you wear a nametag twenty-four hours a day, seven days a week?

Scott Ginsberg has done just that for the last 4,305 days – over twelve years.  What started as a social experiment has evolved into an urban legend, world record, cultural phenomenon – even a profitable enterprise. If you Google the word nametag, and you’ll see his work benchmarked as a case study on human interaction, revolutionizing the way people look at approachability, identity and commitment.

As a writer, Scott’s authored twenty-five books, produced his own online show on NametagTV.com and reached millions of readers on his an award- winning blog.

As a performer, his one-man show has made over six hundred corporate appearances in five countries.

He has been featured in hundreds of outlets such as 20/20, CNN, USA Today, The Wall Street Journal, Inc. Magazine, The Associated Press, REDBOOK, FastCompany, The Washington Post, Paul Harvey, The CBS Early Show and Headline News, and Scott was even inducted into the hall of fame of Ripley’s Believe It Or Not.

And best of all, we went to high school together.

Find out more when we talk about:

  • How a simple experiment turned into a life-changing career, and how you can apply his lessons to your own personal brand
  • How to use “strategic serendipity” to your advantage by being ready for good fortune when it shows up
  • The elements that made Scott a highly in-demand speaker and consultant
  • Why having an attitude of being open to what the world brings you can lead to some unexpected booms in your career

 


Interview

Podcast: Play in new window | Download (Duration: 38:04 min — 36.5MB)


Resources and Follow-Up

(According to Scott’s instructions):

“Go to Google, and type in the word: ‘nametag.'”

 

 


The Business of Art: Three-Way Interview with Melita Noël Cantú and Starla Halfmann

The Business of Art: Three-Way Interview with Melita Noël Cantú and Starla Halfmann

Ready to talk about the business of being an independent artist?

In the first 20 minutes of this 50-minute interview, Melita Noël Cantú and I discuss the multi-city project that she and her husband have developed called Art on the Roof, a unique, one-night gallery event to highlight and show the work of high-tier artists. We talk about the strategies they’re using to promote the event, as well as some of the business and creative collaborations she has built with galleries, artists, and even government officials in different cities to help promote the event.

Then, I conference in my good friend Starla Halfmann. Starla is an emerging artist who has already built a strong foundation for success, but hasn’t cracked the code to quit her full-time job and live out her artist career full-time.

The three of us discuss:

  • How to create gallery and print sales opportunities for yourself by developing a network of other artists and fans, even if you’re a shoe-gazing introvert who hates leaving your studio
  • Why having a professional-looking website is absolutely essential and can mean the difference between success and failure
  • How leveraging online resources like Pinterest can boost your print sales and introduce you to thousands of new followers and fans
  • Some little-known secrets to putting on your own shows and getting tons of people through the door

Interview

Podcast: Play in new window | Download (Duration: 52:43 min — 50.7MB)


Resources and Follow-Up

Melita (and Javier) Noël Cantú:

ArtOnTheRoof.com
JLCArt.com

Starla Michelle Halfmann
StarlaMichelle.com
PaintABirdADay.com

Additional Resources Mentioned:

GlassTire.com
ImageKind.com

 


Where to Find Content for Websites

Where to Find Content for Websites

Always struggling with content for websites?

A lot of us small business owners have the same quandary; we want and need (more need than want) more content for websites.  The marketing mega-minds out there keep telling us we need to keep things fresh and updated on our sites, but we don’t always know how to find content for websites that actually relates to what we’re doing and that people want to read.

There’s a concept that I seem to keep running into called Content Marketing.  It is just what it sounds — the notion of putting content on websites.  But it’s also the study of where to put it, how often to rotate it around, how to place it on social media without overloading your audience, and all sorts of nonsense that probably induces voluntary narcolepsy in most small business owners.

Hopefully, this will simplify the whole “Content for Websites” thing.

Just found a great free resource through TopRank Online Marketing.  It’s a free ebook called 29 Secrets About Content Marketing and the Undercover Agents Who Shared ThemI just paged through it, and it’s got some fantastic tips on how to do content marketing without driving a spike through your eyeball.

Wow.  That was violent.

At any rate, check it out and see what tips you can pick up to get the whole content monster thing under control.

Enjoy.

 

Etsy Gift Cards Part of New Direct Checkout Program

Etsy Gift Cards Part of New Direct Checkout Program

Gift cards part of Etsy’s fancy new Direct Checkout platform

Etsy, a major marketplace for audience-produced crafts and art pieces, just announced they’ll soon be selling gift cards.

Part of the new “Direct Checkout” platform, the cards will show up in the form of a code.  Buyers can then use that code toward purchases at any shop that accepts Direct Checkout.

The cards will only be available online (no plastic or other real tangible versions) and will have a maximum limit of $250.

“You can email the gift card directly to a friend or print one out to give in person,” writes Etsy’s Product Marketing Manager Natalie Schwartz in a blog post. “The gift card credit will be in the form of a code, which buyers will use towards purchases at any shop accepting direct checkout.”

Etsy rolled out the Direct Checkout platform a little over six months ago, and they’ve already rolled $50 million through it via 100,000 shops that have signed up.

The company said they have no plans to remove PayPal as a payment method.

As a way to celebrate the new gift cards and Direct Checkout platform, Etsy is waiving all credit card processing fees for all new (and existing) customers using Direct Checkout all through September.  It’s their way to let consumers test out the platform before the holiday season hits in December.

I personally have never used Etsy, but have talked to several crafty crafterson friends who have.  Seems like a great place if you’re an independent artist, crafter, or all-around creative type who makes stuff and doesn’t want to build the infrastructure to sell it on your own.

Are you an Etsy-ian?  Used it before and made a buck or two (or bought from it)?  What are your thoughts about the new Direct Checkout platform?  Talk to me in the comments below.

 

*Some info borrowed from Mashable, who likely knows way more about Etsy than I do.

Entrepreneurial Networking: How To Learn To Love It

Entrepreneurial Networking: How To Learn To Love It

Entrepreneurial Networking can be fun.  No really.

You love what you do.  You’re good at it.  But that doesn’t mean you love talking to people about it.  I know artists, writers, even public speakers who can’t stand entrepreneurial networking.  They find it unnecessary, forced, and frankly, they know they kinda crappy at it.

Okay, wait…back up.

Earlier in that sentence was the word “forced.”  Why does it have to be forced?

After all, entrepreneurial networking, at its heart, is just having a conversation with people who are interested in the same thing as you, and then finding a way to help each other.

When you look at it that, way…that you don’t have to prove anything, sell your widgets, or self promote, things get a little easier.

Here are three quick tips to grease the wheels and make the process more fun, so you actually go do it…and like it.

Networking Tip #1: We’re All in This Together

Entrepreneurial networking is a big scary term until you break it down and say, “This isn’t about me finding people to do business with — this is about me finding friends who do the same thing.”  Find people who are in at least a similar or complementary industry to you.

When I go to a networking group or conference with small business owners, I often have a nagging fear camped out on my shoulder that’s jabbing me, saying stuff like:

“I’m not on the same level as these people.”

“I won’t know what to talk about.”

“I bet my teeth won’t be as white as theirs…”

…blah de blah blah.

Those are all ill-placed self-defense mechanisms that are kicking in.  But they aren’t really going to protect you.  They are based on fears…usually unrealistic fears, that come from some part of your history or some other area of your life.

If you’re interested in what you’re doing, neither your experience nor the whiteness of your teeth should matter.  Why?  Because these people you’re talking to are interested in the same thing.

When you approach a conversation with those people, realize that they’re probably in the same boat as you; they have some of the same fears, challenges, interests, and even passions as you.  That means you have plenty to talk about, and frankly, they’re probably just as worried about how they’re coming off as you are.

Networking Tip #2: Never Lead With “What Do You Do”

I picked a great tip from my friend Patty Farmer, the Networking CEO about this particular phrase.

When you ask somebody what they do, a particular sequence gets triggered in their brains.  They are no longer in “I’m talking to a person” networking mode; they switch over to “I’m talking to a potential customer” selling mode.

Instead, ask somebody about them.  Find out about their kids, their hobbies, what inspires them, how they got involved in this particular group/function/etc.

Obviously, you’ll eventually want to lead into the “what do you do” piece, but starting out, get to know the person and NOT the business person.

Networking Tip #3: Be An Active Listener

Business networking is a funny animal.  Especially entrepreneurial networking.  Most business owners are pretty alpha and like to talk about themselves. Not all of us, and certainly not all the time.  But 9 out of 10* of us admit that we are often waiting for the break in conversation so we can talk about how flippin’ cool it is to be us.

But if you take a real, active interest in your conversation partners, the better the conversation and relationships are going to be.  Be anactive listener — one who listens and asks good follow-up questions that are open-ended (meaning those questions don’t just get a one-word answer).

And one key piece to the whole puzzle is having empathy for other independent professionals and small business owners — trying to truly understand who the other person is and what they’re going through…good or bad.

Building your entrepreneurial network isn’t the unslayable dragon that we make it up to be in our minds.  It’s a great way to not only grow your business, but make friends who are often on the same path as you.

So, try hitting up a entrepreneurial networking group or Meetup.com event, and, y’know…try to have some fun while you’re at it.

*A completely unfounded, made-up, and can’t-back-that-upable statistic.

Interview with Teri Hill

Interview with Teri Hill

Teri Hill is the former President of the Austin chapters of the American Society of Training and Development and the National Speakers Association.  She has been coaching and training leaders across the globe for over 20 years.

Her clients include numerous Fortune 500 companies, small to mid size businesses, state and federal agencies and non-profit organizations.  She’s a highly in-demand speaker and educator, presenting to thousands of people.

We cover a ton of ground in this interview on everything from:

  • Some of the most common limiting beliefs (even ones held by Fortune 500 exec’s) and how to start burning them down
  • Using powerful techniques for better conversation between you and your clients and partners
  • Exactly what to do when your 1,000-person audience stops paying attention, and how to get things on track so they’re hanging on your every word
  • The one trick you NEED to have up your sleeve before speaking to any audience
  • Some not-so-known confidence secrets that Teri teaches her clients

 


Interview

Podcast: Play in new window | Download (Duration: 53:53 — 51.8MB)


Resources and Follow-Up

T.H. Enterprise

http://www.terihill.com