Ruralweb/start-up finance
< Ruralweb
What is start-up finance
[edit | edit source]A starting business will not make profit immediately. A social business in the Netherlands will take up to 2 or 3 years to get financial sustainable. What are the opportunities for start-up finance?
How to access start-up finance
[edit | edit source]First of all look at solutions in own your community, because it is faster & gives you more confidence as a business (wo)man and as a community:
- crowdfunding in own community amongst family and friends. Their donation will be a loan; repaid when business started off (with a risk that the business won’t be profitable).
- Revolving fund: gather 10 business-(wo)men to be – all put in a certain amount of money (periodically?) – 1 person can use it as a start-up finance. When profitable the amount is paid back to the group for another business (wo)man to start.
- What are the possibilities for corporate sponsors in your own community?
- Prudent use of resources.
- Use the services of experts, friends etc. who will offer free services.
- Encourage personal savings and record keeping as prove of your viability of a business venture.
- Collateral security.
- Ownership: Someone from outside comes in with a business idea and the start-up money. Once the business is profitable a local business man could buy and take over the business.
- Franchise-businesses: Managing a branch of an already tested concept and being responsible for the branch in terms of profit and success.
- Community fund-raising for community project: http://www.youtube.com/watch?v=akuWiVtxz8A
Possibilities financial institutions outside your community.
- Crowdfunding Remittances from diaspora living in Europe!
- Fundraising outside your own community
- Equity crowdfunding [to be extended]
- Banks or financial institutions are usually difficult to engage for financing in an early stage of business or for young entrepreneurs.
- Microfinance (often have huge interest rates).
- How to arrange low interest loans?
- Access grant facilities to start first pilots with (since start-up period is quite difficult).
Examples from the community
[edit | edit source]https://en.wikiversity.org/wiki/RuralWeb/Start-up_finance/Examples_from_the_community