Incentria

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How to get Funding for Your Venture

3 min read

Listed in no particular order, here are some of the most common ways to get funding for whatever business venture you want to get off the ground. Some are naturally much better than others, but it all depends on what kind of business venture you want to get into and where you are in terms of the capital you have, the sweat capital you’ve already put in and in consideration of any other investors who might have already pumped some money into the venture.

Angel Investors

Angel investors are great sources of funding because when they invest their capital into your venture, not only does it mean they believe in it enough to risk their capital, but they also avail themselves to help you with the day-to-day operations and development of the venture. It’s not easy to get funding from an angel investor though.

Venture Capitalists

VC firms are more formalised versions of angel investors in that they are professionalised, official corporate structures which are in the business of funding ventures for profit. Venture capital can be great if the exit strategy you’ve earmarked for your venture is that of something like going public and listing on the Stock Exchange. VC money is also not easy to get, although Silicon Valley might suggest otherwise.

Crowd-Funding

If you can get your venture crowd-funded then that’s exactly how you should go about raising money to get it off the ground. Typical crowd-funding platforms don’t allow for equity to be exchanged for the pledges contributed by what are subsequently donors. So that means you don’t need to pay anybody back, but this is tricky because donors naturally want some kind of value to be returned to them for their pledges.

R&D Government Funding

Research and Development funding from the government is another great way to raise the capital needed to get a venture off the ground, simply because you would effectively be receiving taxpayers’ money to develop your idea. The trick is to go into a venture which seeks to develop something which the government can either buy from you and deploy for the masses, or something which will subsequently help the masses.

R&D Private Funding

Private Research and Development funding works in much of the same way as government R&D funding, except here you’d be dealing with a private entity as opposed to a government. The same applies with regards to the types of projects, except the private company naturally wants to gain some kind of profit out of funding the ventures they choose to fund, instead of doing it purely for the benefit of the public.

Bootstrapping

If you can work to build up the capital you need to get your venture off the ground, bootstrapping in this way is definitely one of the better ways to do so, except it’ll likely take a bit of a while.

Loans

Loans are granted for those ventures which have a solid business plan, so if it’s something new you’re working on then it’s very unlikely that an institution such as a bank will grant you a business loan to get it off the ground.

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