How To Raise Funds For A Startup Business In Nigeria 2020: Simple And Fast
Raising funds for startup business can be quite simple and fast if you know the best way to go about it. Every day, lots of businesses crash as a result of inadequate funding. There are those that cite the lack of startup funds as their reason for not becoming entrepreneurs. Do you know that you don’t really need money to draft your business proposal or plan? I don’t think so.
Also read: How to grow your business from scratch
You need to understand that your business proposal and plans are essential for your startup development. However, there are people that are in need of funds for a startup business to get off the ground. There is always the search for how to source for funds to start a business in Nigeria. Many people spend a fortune looking for how to raise capital for business.
Well, there are different ways to raise funds for your business, but you have got to be smart and disciplined about it. In this article, I will show you five practical ways to raise funds for a startup business in Nigeria. All you have to do is pay attention and be ready to put in the work needed for this task. The information shared here will help you raise enough capital to drive your startup to success.
It is important to note that having a reliable source of funding for your business is never a guarantee for having a successful business. There are many factors that aggregate to determine the success of any business establishment.
Here Are 5 Practical Ways To Raise Funds For Startup Business
Create your personal savings
Without any doubt, this is practically the best way that you can raise funds for a startup business in Nigeria. As an aspiring entrepreneur or business owner, you must have a personal financial commitment to your business. It must not be big, you can start small. If you fail to have a personal financial commitment to your business, nobody will take you seriously.
If you raise a reasonable sum of money, it will be easier to approach another party for help. It makes no sense when you go to people for funding when you have nothing on your own. When you approach someone to fund your business and you tell the person the amount that you have raised on your own, it gives credibility to your quest and shows your determination. There are platforms that can help you to easily save money for your business startup in Nigeria. We have online savings and investment platforms like SumoTrust, Cowrywise, etc with good interest rates on your savings. SumoTrust pays you between 10-15% interest on your savings with them.
They also have a mission savings account for you to save towards your desired goal. 2020 has just begun and you can start saving as little as #100 every day, weekly or monthly depending on your financial capacity. You will be surprised at the amount of money you must have raised on your own within 6 months. Visit www.sumotrust.com to create your free account and start saving to raise funds for your startup business.
Your family and friends
Another one of the practical ways to raise funds for your business is through family and friends. Aside from saving up for your business, your friends and family members are the next best option. However, ensure that you already have some personal savings for you to be taken seriously. No one will be willing to invest in you if you can’t even invest in yourself.
For instance, if you need #100,000 to augment your personal savings to fund your startup, you should probably request for #10,000 from 10 people among your family members and friends.
An angel investor is any rich individual that provides capital or funds for startup business in exchange for ownership equity or convertible debt. When you search within your environment, there are people willing to invest in your business if you are willing to part with some equity. You need to find such people and send them your business proposal. Remember that you should elaborate on what you need from them and what they stand to gain in return.
These people are businessmen, not philanthropists; hence the more reason you must present them with an offer they can’t reject. Whatever you do, ensure you live up to your end of the agreement. In business, trust is everything and if you lose it then you have lost everything.
Commercial bank loan
In as much as I dot recommend this particular option, it is undoubtedly one of the ways to raise capital for business. When you need money to start a business, the bank should be your last resort. Anything can go wrong, especially when it is a new startup. In such a case, you will find yourself in a very dire situation with the bank. If you believe that it can work for you, then there is no reason for you not to go for it. But my advice is that you must be careful when applying for business loans from banks.
See: How to build a strong business network
In Nigeria, the government and certain organizations like the Tony Elumelu Entrepreneurship Programme (TEEP) give out funds to empower entrepreneurs. Before you can get grants from these establishments, you must have got your business plan in order and have shown a strong desire to succeed.
Have it at the back of your mind that business success does not come overnight, it involves work and money. What this article has done is to help you sort out the money aspect. The work aspect is solely up to you and you alone.
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