Many people across the globe have aspirations to venture into business. The Small Business Administration reports that investors started one million small businesses between 2019 and 2020.

For these businesses to get off the ground, they need one common factor – money! And this is what creates the difference between entrepreneurs in business and those in waiting. Supposing you are in the latter category, you’d probably want to know how the former got funding to launch their businesses. If that’s so, this post is entirely yours. It explores some viable ways through which most startup entrepreneurs get startup capital.

Savings

As evidenced by the Gallup Small Business Index report, most startup entrepreneurs use their savings to kick-start their businesses. So, if you are an aspiring entrepreneur with some savings, you are good at getting into business without relying on any private money lender. But before you do that, you’ll want to think of a few things. For instance, consider the amount of savings you have and the amount you can risk comfortably.

Personal Loans

The next way entrepreneurs get funds to launch their businesses is through acquiring personal loans. Personal loans refer to money borrowed from friends and family. To avoid dire implications, an entrepreneur looking for personal loans should consider writing the terms of such loans. Define how much you want, interest rates, and repaying dates.

Credit Cards And Bank Loans

You can use either a personal or business credit card to get loans. In fact, most early-stage entrepreneurs get 25% of their funding from bank financing and credit cards. Although it’s a funding method that has helped many entrepreneurs, it usually has higher interests that can impact your business negatively if you’re not cautious.

Banks or private money lenders require a solid plan and excellent credit scores to fund entrepreneurs. In most cases, entrepreneurs have to begin the business with their cash and prove their progress to the bank before being funded.

Angel Investor

Angel investors refer to wealthy individuals who use their money to fund early-stage entrepreneurs and businesses in exchange for ownership equity or convertible debt. Currently, there are more than 250,000 private investors in the United States funding 30,000+ small businesses. So finding an angel investor to offer your business some support shouldn’t be a huge challenge.

While the above are some of the most common ways to fund startup businesses, there’re so many other viable ways through which entrepreneurs can fund their businesses. So, don’t be limited to the above alone. Rather, keep searching and trying until you find the best viable funding option for you.