Trick or Treating For Small Business Funding
When it comes to searching for funding, you’re no longer the kid with the ultimate trick-or-treat route. Now’s the time to knock on every door, no matter how uninviting they might seem from the curb..
Let the Funds Knock on Your Door
You could create a Website soliciting donations for you and hope for the best, or you can create a profile on Kickstarter. Fair warning: Kickstarter’s business model caters toward creative projects and tech businesses. This online community serves as a platform for entrepreneurs to:
· describe their business or creative project
· explain the funding needed to make their dream a reality
· set a deadline for when they need to receive their funding
· create incremental donation levels and “compensation” for each level of donation (often called “crowdfunding”).
For example, if your business needs funding to create the first practical, mass-produced butler robot, you may reward a $50 pledge with one of P.G. Wodehouse’s “Jeeves” novels with your autograph (low-level pledges are often compensated with cheeky or whimsical gestures). A $2,000 pledge may receive two butler robots with the backers’ name engraved in gold on each.
Of course, this tactic doesn’t involve knocking on any figurative or literal doors. It does, however, give the world something to see when it rings your e-doorbell.
Don’t Pass on Government Sweets
Yes, obtaining a loan from the SBA as well as most state and local governments involves beaucoup paperwork and a significant time investment. And so does every other lender.
While many government-sponsored funding sources are geared toward older entrepreneurs, some have been worthwhile for young entrepreneurs, including:
· SBA Microloans— You may want to knock on the doors of a nonprofit community-based organization in your area that offers microloans. These short-term loans can play an important role in your lending portfolio. Funds are generally reserved for working capital and a variety of purchases. The average loan clocks in at roughly $13,000.
· State and local loans — Check out Business USA’s State and Local [U4] section to find resources in your area. This site isn’t tailored to youth entrepreneurship, so be prepared have some doors closed (politely, we hope). The good news is that many governments are considering increasing loans to young entrepreneurs. Great Britain recently announced a £10 million youth enterprise loan program[U5]
· University-sponsored or -hosted programs — One young entrepreneur recently secured $25,000 through an entrepreneurial competition at his employer, a state university. He had to quit his job in order to qualify, but his decision paid off in the end. Scour local universities’ and community colleges’ business departments and employment centers to see what opportunities are coming through town.
And don’t forget—there’s always the TV show Shark Tank.
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