- June 21, 2017 at 11:45 am#4516Matthew KingKeymaster
This is a question that has always intrigued me. Finding out the many different ways that businesses have funded their adventure and growth. I have had the pleasure of starting three businesses all with different types of funding.
My first business started off of no funding period. I didn’t have a dime or even a website to speak of. The business actually began off of a forum like this one. I was just looking for information to read and to find out how a few extra tips about insurance products. After a while, I was able to help some of the members that were also on that site and build a business that helped those members, provided commissions for both the members and myself (a small 5% percentage for myself) to build the first business. It was pure luckiness is what it was.
The second business and also a failed one. I had taken a loan of about $20,000 USD to start a online retail store that focused on military veteran type products. However, it also had an additional facet to it. It was made to donate some of the profits to military charities and to be a free service for veterans to find resources and get help. I thought it was a GREAT IDEA! However, I was alone in this endeavor of mine. I would have loved to see it work myself as I am a veteran as well. After six months, I did sell products and did well on the retail side. However, my dream of developing an established service to veterans struggled and I didn’t have the resources for myself to build upon this second business, help veterans, and run the first business. I was unable to get the business truly going. In November of 2015 I closed the business.
The third business (after I paid back that $20,000 Loan), I started in February of 2016 it was strictly online based and I said I wasn’t going to dump money into something that hadn’t generated its own revenue stream. So again, I started without a website, with no capital, and the only resource was myself. I began a web designing business which stemmed back to 2007 in my early days of coding and design class. I did some small jobs here and there to get the ball rolling, then got help with staff members willing to work as hard as me. The business took off and I have now ran both businesses successfully for two years.
Let me hear your story, how did you start your business? Does anyone have a case where they took captial and made way more in the first few years?
- June 22, 2017 at 9:48 am #4528ParamParticipant
- Total Post: 9
Thanks for sharing your great business Funding insights. I really liked the way you struggled through.
Here’s my journey.
– I started with providing IT services to customers online through upwork way back in 2012 when alot of people were deprived of this marketplace due to lack of knowledge.
– I dint actually have to fund it because I could easily find my co-founder and we both were the in-house team of developer and a business finder.
– In 2014, we’d grown enough to think of a new venture or expanding the same venture to new heights. But IT services being over crowded we thought of starting up a coworking space as the concept was alien to our region then.
– While setting up the coworking space which would support startups, freelancers, small businesses etc. in setting up their dream ventures of be their own bosses, we found two other co-founders which could take the concept forward and establish a coworking space with us.
– We invested a minimal amount of Rs. 1Lac each here in India and setup the space. Customsers started to flow in that one floor of 2000Sq Ft. and soon it got sold out within a span of 8 months.
– In January 2016, we took another floor in the same building on lease and launched it. For setting this up again, we put in some more amount of money which was around Rs.1Lac each. Now two floors were not possible to be setup in 4 lac each but until then our business could bootstrap itself for further development of infrastructure. Until late 2016 we did not properly get payed out of that business but yes, we bootstrapped it and never went for an external investment.
– Now, in June 2017, we’re again in a position to expand our office coworking to more space for which we may require external help because the infrastructure stakeholders have increased. We may require a ccapital of 20Lacs at once to set the basics up.
What we’ve learned from our journey: Keep putting money in your venture, the right and minimal way and it will definitely pay you back someday. Bootstrap. Thats the beest way to go for it. When you get external funding for your business from inception, you do not learn a way to survive tough tides.
- June 22, 2017 at 7:00 pm #4548
Yes, being an entrepreneur can oftentimes be an “expensive” learning experience. While I’ve been involved in the financial services and insurance business for most of my career, there was a point in the mid-2000s where I considered changing careers to become a real estate investor. Unfortunately, timing is often just as much of a factor in your business success as money, experience, and well, just about anything else. In this case, I went on a property buying spree at the top of the market – just a few years before the big market crash of 2008. This meant that I not only purchased several properties that were essntially way over valued (and overpriced), but when I went to sell them in 2008-2009, I didn’t get nearly what I had planned on. In fact, in one particular case, I spent in excess of $5,000 fixing up a house (after my tenant destroyed almost every inch of it), and then still had to bring $17,000 with me to closing as the seller! The lesson learned here, among others, was to stick with what you know…especially if the endeavor requires a large out-of-pocket financial commitment from you.
- June 23, 2017 at 1:15 pm #4555
I can’t agree more here on this one. I own only one property at this time and I have thought about maybe getting just a couple more. However, I want the mortgage to the first one not to be there before I do that. I rent the other property out now and I rent the current place I stay until I can get into a really nice home that I can afford and want to live in forever!
- June 28, 2017 at 9:40 pm #5000ursellbParticipant
- Total Post: 8
Well I funded my business by getting a
Credit card and that didn’t work out for me because I haven’t made any money
- July 5, 2017 at 1:07 pm #5038Destiny ValidParticipant
- Total Post: 4
When I started my business,I initially used friends and family debt capital until I was large enough to attract more substantial from other investors.
The truth is,most small businesses piece together their funding from several different sources phased out over time.
- July 6, 2017 at 6:41 pm #5078
How has that worked out so far? Have you managed to pay some people back, do you have anyone asking for the promised money as of yet?
- July 9, 2017 at 12:28 pm #5120Destiny ValidParticipant
- Total Post: 4
Everything has worked very well.I have managed to pay up all the debts.The business is operating very well.
- July 10, 2017 at 11:13 am #5123
That is very enlightening to hear. Especially after my own business catastrophe where I had to pay a bunch of credit cards back to take care of a failed business. It’s a good thing I have two that are successful now to make up for the one failure!
- July 5, 2017 at 8:09 pm #5044
In many cases, piecing together funding from numerous sources is the way that companies have gotten off the ground. Oftentimes, an entrepreneur may not have access to loans or other avenues of credit. Therefore, turning to family and / or friends for funding may be necessary. In other cases, a new business owner may need to continue working either full- or part-time so that income will continue until the business gets up and running. While it may provide you with more time to work on your business, going full force at the beginning could have disasterous consequences if you have not incoming cash flow, and the business does not take off the way you hoped it would.
- July 6, 2017 at 6:47 pm #5079
An important factor is that even if you fail whether through funding, mis-management, or any other way failure can happen to a business venture. It is always best to take it as a learning change. Find out what went wrong, learn from it, move on and get back on the horse so to say.
I had a pretty big failure in my second business, I owed a good bit of money. However, over time, I paid that money back and I don’t owe anyone. Another funding type that I want to talk about is re-investing in your business. This could be many different types of investments such as putting money into your website, conversion tools, hiring employees to help with the work load or freelancers. I believe after the initial funding to get your business going is a plan to re-invest into the business after its been going for a while. A workforce that you treat with respect because it is growing your business by taking some of the work off of you.
- July 11, 2017 at 3:53 pm #5145
Sometimes it may be necessary to get a “job” if your business – and its funding – doesn’t work out. But as others have stated, it is important to take the learning experience as to why the business didn’t take off, and use that knowledge for moving forward when you decide to try again. Just like Thomas Edison said when the light bulb didn’t work over and over again, “I have not failed. I’ve just found 10,000 ways that it won’t work.”
- July 12, 2017 at 10:09 pm #5152
Great Quote! I most certainly found a way not to run a retail business when I first started that adventure. I am not sure I would open one again but I definitely learned some valuable ways to adjust my current businesses and take it much slower than I did that first time.
- September 16, 2017 at 9:49 am #5318Purity ManiParticipant
- Total Post: 2
They are so many ways to fund a business,one can sell something you own like a car if you have like 2 or more cars you can sell one which don’t mostly use of which you can replace later but sometimes requires sacrifice you can choose to stay without a car for a while and once the business has picked you can replace it .Also you can have a credit from a bank or from credit offering institutions and pay by installments,or borrow from friends and family.
- September 17, 2017 at 6:27 pm #5324
After seeing your post, it also made me think about another way to get investments into your business is to offer partnership percentages such as 1% or 2% on all sales for this product. How did you fund your business?
- September 29, 2017 at 4:26 pm #5355DieterParticipant
- Total Post: 4
After living and working in Dubai I got laid off from my international employer. I was given the option to return back my home country or find another job. I have chosen door number two, trying to find another job. Lucky me my boss was so nice to allow me to keep my visa. To actual stay in Dubai you require a sponsor who pays for your visa so you can stay. After taking a couple of freelancer jobs and I earned quite ok, I meet new friends who trusted to raise a new company with a business we all 3 hade been interested in. Lucky me, all 3 of us put money into the company, myself I had only a little money to pay for my shares but was the only one working in this company and actually contribute with my knowledge and hard work. We had startup capital to make our own office, hire people and kicked off our IT Service company. In the second year, we paid all our founders loan back (1 million) and now run on our own earnings.
I trust people who want to invest into a company more than looking for an investment company. Investment companies are not very flexible, your reporting kills you along the way so you spend more time on reporting than earning money. I can only advice, find the right guy who believes in your idea and can give you the money.
- October 16, 2017 at 10:35 pm #5372
Awesome story! I’m hoping others share their experiences as well!
- September 30, 2019 at 7:40 am #506586Jonathan WilcoxParticipant
- Total Post: 1
It’s been great to hear your stories.
I am working as a Project Support Officer at WINN hub – https://winn-hub.com/ the go-to place for innovators across Worcestershire taking their idea and making it a success. Funded by Worcestershire County Council and the European Regional Development fund – we provide grant funding, technological development and networking opportunities across the county in order to develop the economy and promote Worcester as a whole.
Our Proof of Concept programme where support is offered to applicants in order to advance, protect and commercialise early-stage innovative business ideas; creating products and services that are both exciting and new to the market. The programme offers grants of up to £30,000, representing 40% of the total project cost.
Please feel free to check out some of our case studies at the bottom of this page http://www.business-central.co.uk/proof-of-concept. If interested, please register your details with Business Central on the same page and they will be in touch to discuss your eligibility.
Best regards, Jonathan
- September 30, 2019 at 7:43 am #506589
I’m glad you enjoyed the stories! I think it would be great to have a few of your clients do some testimonials and add them right to your post. This way they can tell their story and how it helped them grow.
- November 13, 2019 at 9:02 am #506637paymenthuddleParticipant
- Total Post: 6
My business is about to go live in December – all without needing any additional funding. In order to do this though I had to give some equity to a person who could build our website and develop the software needed to run the website effectively.
The business is an Online Marketplace for business owners looking for Payment Processing. Think of it as what Lending Tree and Hotwire do but centered around Payment Processing. A business owner can come to our site and have 3-5 payment providers give instant pricing quotes to them for their merchant services. The business owner can select the one they feel is best suited for them and we then help with the application and sign up process.
Our revenue comes from the payment providers who pay us a residual for every customer that we bring through the door and thus there is no fee for any customer to come to our site to have companies bid on them.
- November 13, 2019 at 9:05 am #506642
^ This is an awesome example of building your business through “sweat equity”! That’s awesome that you got someone that was willing to build your business with you! Just to clarify for other members here. About what percentage of equity did you have to give?
- April 30, 2020 at 1:29 pm #506960Taxolawgy Online ServicesParticipant
- Total Post: 3
Well, being an entrepreneur is not easy. You have to cross many hurdles but if you are passionate and confident about yourself, you can do it! However business investment can be very tricky. There can never be a best way because different things work for different businesses and different people. We started off by personal investment. Saved money for a long time and then started our business. You can get help from your relatives or friends for the investment or you can just find angel investors online or do crowd funding. Whatever suits you. But before that you have to know why one would invest in your startup business. This can help you very much in your startup business.
- April 30, 2020 at 1:32 pm #506963
Thank you for the resource. What amount did you end up saving to (doesn’t have to be exact) for your business venture? We have a lot of self-funded business owners as members!
- May 4, 2020 at 2:10 pm #506969Taxolawgy Online ServicesParticipant
- Total Post: 3
It was not easy when we started to think about starting our own business. But we saved enough around 40k-50k. And it was slowly continued on the side while pursuing own profession.
- May 4, 2020 at 2:32 pm #506972
That’s a really good figure! Nice job!
- June 12, 2020 at 8:03 am #506997technologyParticipant
- Total Post: 1
Thank you very much ,for sharing your experiences. But for me I have been thinking of how I could raise capital ,like from scratch.
And it just came to my mind to say my mum actually bought a farm plot ,about a year ago and I thought of actually doing some farming there for like a year or so .
So as to raise some capital
Now do you think this can be a great idea
- June 12, 2020 at 8:07 am #507001
I believe taking a part-time job to save some money for your business is always a great idea. I know some people that have done worked part-time, sold old collectibles (like baseball cards, etc) just to start saving for their business venture.
I definitely think this should be a good idea for you. While you are doing that, think of the processes you go through each day to complete the tasks for farming. What has to happen, in what way does it happen and how do you get to the end result.
Then apply those thoughts to the business you’re creating. How will you start, what are the processes, how do you get things done, and what’s the end result. This is just to get you started.
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