Tips on Finance Options for Startups
There are dozens of finance options for startups, but I will tip you on a few I know won’t come with headaches; I hope you will find them interesting.
Personal savings
Your fund as an investor is the most important option you have to kick-start your business. No matter how brilliant your business ideal and model is, you will hardly find anyone to invest in you unless you foot the initial bills of giving reality to your business. Your savings can come by planning ahead and put aside some funds for your business take off.
Family and friends
No matter how bad, there will be one or two people around you who will believe in your idea and be ready to invest in you. With your savings leading the way to show people what you can do, your family and friends are the best next funding source to explore. If you have done your business plan correctly and know how much you need, do a small business presentation to discuss with trusted relations for funding.
Crowdfunding
For a short-term funding need, you can use a third-party finance option such as kickstarter.com to raise funds for your business. This will require you to set your financing goal and state how much you need to raise and when you need it and get close relations friends and family to pledge support. This is a project based funding and may help you to keep going in business.
Angel investor
Getting finance from angel investor can be a relief if you succeed because they invest in your business for equity stake; meaning they will own part of your business. But mind you, they are not doing this for profit, but to get you started because they believe in your vision and business idea. The challenge for you is finding one and convincing them you are worth their investment.
Small business loan
There are business friendly institutions like Small Business administration (SBA) or financial institution small business desk who offer loan facilities to startups. You need to find such resources and understand the procedure to apply for a small business loan.
Credit card/bank loan
You need caution using this option. However, it can be a source of quick financial intervention when you are facing a business deadline and need funding twice as fast. You must be ready to abide by their long list of conditions and make sure to pay back more quickly too to build your creditworthiness.
Limitations to Watch Out For as a Business Owner in America
Running a business is not a tea party; you have a plethora of legal issues and decisions to make from time to time which without you risk a faceoff with the law. Here are five crucial challenges to overcome to survive in the U.S. business terrain:
Licensing and permits
Obtaining proper license and permits are legal requirements, and it is your duty as a business to find out what documents to get according to business laws in your location. You can find out this information from the business office in your local and state government.
Employment termination
While it is your right to hire and fire, you need to do it right. Otherwise, you may land in problems you never imagined possible. The right thing to do to address this is to, clearly, spell out terms of employment and disciplinary actions you can take; work with your attorney to develop the terms of engagement and have your employees acknowledge it by signing relevant acceptance papers that will save you from litigation if you have to fire upon violation.
Immigration Audits
When hiring staff, make sure you employ only people with the legal document to work in the U.S.; under no circumstance must you offer employment to people without clearance to work as represented by work permit visa of various types provided to non-US citizens to work in America. Remember, it is your responsibility to conduct independent background check on each staff to employ beyond the papers they present to you. If you failed to do this, the US immigration is in the habit of conducting surprise immigration audit, don’t be found wanting!
Proper business accounting
Even though it’s your business, you need to keep an appropriate record of the transaction for accounting purposes. Proper bookkeeping and accounting will save you from tax complications when your business book is scrutinized.
Discrimination/Harassment Cases
Make sure to follow national employment guideline when hiring your employee and don’t get caught in issues relating to sexual harassment, age discrimination, and ethnicity bias. If you are found wanting in any of these issues may get you into serious trouble in the U.S.
Mikhail Adeoye
Mikhail is a content creator, a digital marketer, and an entrepreneur. He studied Political Science at the University of Ilorin Nigeria.
Sources
https://smallbiztrends.com/2013/11/small-business-financing-options.html
https://www.lawtrades.com/blog/blog-post/can-foreign-citizen-start-business-united-states/
https://www.nolo.com/legal-encyclopedia/is-illegal-undocumented-immigrant-start-us-business.html
https://www.quora.com/How-do-immigrants-who-come-to-the-U-S-with-nothing-start-a-business
https://www.smallbizdaily.com/6-small-business-financing-options-for-startup-entrepreneurs/
