While everybody knows that you can look to investment companies and venture capitalists for funding for your business, there are plenty of new and nontraditional ways to fund your startup that are already available and are becoming larger segments of the economy than the traditional means of funding. Since there is a heavier distrust for people like venture capitalists after the economic collapse in 2008, nontraditional routes such as crowdfunding have become more of the norm and their use only continues to rise. In addition to crowdfunding, many other nontraditional means of funding your startup have continued to crop up, pushing the creative side of funding to its limits. It would seem that traditional routes of funding have left a void to be filled in some ways, and there have been plenty of ways to fill that void. The following are three nontraditional means that you can employ in order to fund your startup with great success.
This continues to be the largest segment of the nontraditional funding market, especially since the government loosened its restrictions on crowdfunding. This cuts the hassle for many businesses that are looking to get off the ground, as they do not have to haggle with banks or the FCC in order to gain the funding that they are looking for. In addition to this, if a company or wannabe CEO has a large presence on social media before launching their crowdfunding campaign, they are more likely to bring in more donations, which works synergistically with almost zero cost to the startup itself. With sites like Kickstarter and Fundable becoming household names, there is no telling what crowdfunding can do for a business in today's online marketplace.
Traditional investors will only give out no less than $1 and $2 million, but angel investors will give out less. What is the benefit to this? In contrast with traditional investors, angel investors' loans come with far fewer strings attached, while traditional investors will collect on their loans and even put your business in danger to get their money back. In addition to this, with smaller investment amounts, you can collect angel investors in order to show other investors and funders that your business is worth investing in. The only drawback to these investors are that you have to find the right ones that will also work strategically with your business to help it grow.
These programs can be hard to find, but when you do find one, they are a wish come true for any startup. These can be found in almost every major city, and they accept between 3 and 100 startups every year to be fostered by them. Startup incubators will vary in what they will provide to a business; some give office space, some give industry mentors, and some give help with marketing while others give straight funding to businesses, but all of them will be filled with the value of having no strings attached and the perspective of seasoned industry professionals during the most crucial time of your business's development.