Introduction

Entrepreneurs often find themselves in the unwanted position of not being able to secure one or more investors for their business venture. This should not be an indicator that your business is doomed or bound to fail. Your business success depends on how well you conduct your business activities and how well you fill a niche in the market. Your best option when 

You’ve heard the phrase “self-funding your business” thrown around, but what does it mean? Why should you do it? And how can you get started with self-funding? In this article we’ll explain what self-funding is, why you should do it if possible, and how to get started!

• You’re in control of your business’ fate. If things don’t work out as expected, at least you’re not stuck paying back investors or lenders.
• You have better control over the timing of when to take on debt – when interest rates are low or when they spike up.
• There is less pressure on your business because no one else will make decisions for you when it comes to getting financing from outside sources like banks or investors.
• You might be able to get loans at lower interest rates than a bank would charge! This can give your company more flexibility in terms of budgeting and grow faster than if there were tons of debt hanging around that wasn’t being paid off every month (or even every year). Finally…

Saving Money

You should also consider cutting your monthly expenses. This means saving money by reducing the amount of money you spend on things such as rent, utilities, and groceries. If you have a family, this can mean that one person takes a part-time job to cover the bills while others stay at home and look after their children.

You can get funding from your community by asking friends and family members for help or using other methods such as peer lending companies (which allow borrowers to borrow against their future earnings) or crowdfunding sites such as Kickstarter, GoFundMe, or Indiegogo where contributors back projects with small amounts of money each day until they reach their target goal

Bootstrapping

Bootstrapping is a great way to keep costs down and still have control of your business. It’s also an excellent way to build a company that can be sold later on.

In its simplest definition, “Bootstrapping” means that you do everything yourself, from paying for servers and software to supporting customers directly in their payments and deliveries. The only thing you pay for is time spent on marketing or other tasks that don’t require you hiring employees or working with suppliers like banks or credit card companies (although some do).

Crowdfunding

Although the concept of Crowdfunding as a way to raise money for a project or business is not a new one, the modern interpretation of Crowdfunding is dominated by online platforms that are websites that allow anyone to make financial contributions in exchange for rewards (like a copy of your book or an invitation to a summit). You can use crowdfunding as an early-stage testing ground before selling your idea, but also as a way to get exposure and validation from potential partners or investors.

The most successful projects on the popular Crowdfunding website Kickstarter have been those that were able to reach their target startup funding goal within 24 hours of launching their campaign—and some campaigns have even raised more than USD 1 million!

Personal loans

Personal loans are unsecured, interest-only loans that you can use to fund your business. They’re offered by banks and other lenders, so you don’t need to go through an investment firm to raise the capital you need. Personal loans are one of the most popular ways for entrepreneurs to finance their start-ups because they offer low rates of interest and flexible repayment schedules. However, there are some things to consider before taking out a personal loan:

• Risk 
  • Borrowing from Banks – Banks will often assess you on your ability to pay back the loan before it is approved. If you have a steady income with which you can pay your instalments, you have nothing to worry about. If the opposite is the case, the bank may take actions such as levying surcharges and in extreme cases, legal action.
  • Borrowing from Other Lenders – If you borrow money from a wealthy individual or business willing to lend it to you, you need to assess what the consequences of default are. Most lenders will make you sign a contract that states that legal action will be taken on default. 
• How far will the personal loan take you? – If you need GBP 1 million for your business and only secure GBP 30,000 as a personal loan, you might need to reconsider this option.
• How long do you have to pay it back? – Personal loans are often short-term and should be paid back within 2 to 5 years. You may be able to negotiate when you should start paying your loan back, but the leeway on this will be limited for most loans.
• What is the interest rate? – Lenders will decide your interest rate based on the amount borrowed and your credit rating. Lower interest rates are always desirable as you will end up paying back a smaller amount as interest.

Why Self-funding may be ideal for you

If you do it right, self-financing will give you full control over your business without having to ever rely on investors or banks for capital. While many people are still sceptical about self-funding your business, there’s no reason why you shouldn’t take the plunge and give it a try. In our previous articles, we at Equitymatch.co have discussed how to raise capital for your business. There are plenty of alternative ways of funding your start-up, and self-funding may be the best option for you if you want independence and freedom to operate your business without the influence that investors would have on it.