If we plan to start a business, having enough funds is very important. There might be an initial setup cost for the business. Most of people think that would be it but when it starts, there can be other expenses too that are not initially visible to us. Enough funding is very important; based on the type of business we are planning, we can prepare and keep the funds. In some cases, people start with a good amount of money as initial corpus funds and then keep going with the business.
I have seen a few startups that secure enough funds to run their business for like 2 or 3 years initially. Even if the company is not doing very well, it would initially have enough funds available to manage the payments and other expenses. Gradually they start growing the business where additional funding would start coming in. This is how startups strategize these days. There are also many individuals and other funding parties that support the startups during their initial stages.
Crowdfunding
Crowdfunding is the best source of funding for our business. We have to also understand that this is also one of the dangerous means by which we can get the funding. The main reason is that we might be answerable to many people in this case. Our idea has to be very good to impress others and get crowdfunding. I have seen a few startups emerging these days with some crowdfunding.
I know an IT startup company that has a product that other companies are using. Now these other companies have been funding this startup and the good thing is that the main product company works at ease and they don't have a big pressure to bring many innovations in the product. They work in a relaxed way and deliver things when they feel like working as long as the initial product is doing good. This is just an example and people can explore how crowdfunding can address their needs.
Saving some funds for our initial investment
Initially do some day job and start gathering funds that would be required for starting a business. Most of the people did not start their journey on day one as a businessman. Having good corpus funds in hand before we start the business is a very important thing. When we have our initial funding ready, we can invest without any fear. There will be several other expenses that will join us during the initial few months. Only after establishing the business, we will be able to get some returns on our investment. Until then most of the money we earn will also be used for other expenses.
Small business to fund the bigger business
To fund our bigger business idea, it is good to start a small business first and create funding out of it, and use those funds to invest on our bigger business idea. By doing this we will also be able to gain the experience we need from the small business and we will also get a lot of exposure. Later when executing the bigger business, it will also be financially easy as we might have experienced so many things while running the small business.
Some people directly start with bigger businesses and try to be successful. I wouldn't say that's bad because they are ready to take a huge risk but at the same time if they are successful they reap a bigger profit. But the safest option would be to always try something very small and then grow it bigger.
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