Financing tips for new entrepreneurs

Financing tips for new entrepreneurs

Making the decision to undertake is not an easy thing, especially because you expose yourself by putting part of your capital at risk without really knowing if it will work or not, if you have chosen a good idea and it succeeds. So, many entrepreneurs launch themselves in search of financing: credits, loans, factoring...

We want to lend you a hand and, for this reason, today we want to talk to you about those financing tips and tricks that can come in handy if you are one of the new entrepreneurs who has decided to take the plunge and create your own business. Why not do it with some extra benefits?

Financing tricks to undertake more safely

Financing tricks to undertake more safely

There is no doubt that entrepreneurship is a risk. You can have the best idea in the world and not know exactly if it will work or not, if customers will know you, buy, recommend and buy again. And this involves putting many things at stake. That's why one of the biggest obstacles when starting a business is financing, that is, having the necessary money to meet all the expenses, of all kinds, that exist in a business.

One of the first pieces of advice that is always given to any new entrepreneur is to have take into account all the possibilities that exist to finance a project because, many times, these "aids" can be the push that is needed for the business to succeed. Or at least for it to take hold and get ahead.

Do you want more tips? Pay attention.

Take into account the sources of financing that exist

This is something that not many look at because they think they are not suitable, that they have to be returned, or that they are not given to just anyone. And it is actually a mistake to think like that. Especially if you do not inform yourself about them before. You see, in Spain there are not many types, but at least we have some. These are:

  • Own financing. That is, the capital that you can have to start a business. This is something easy because it will depend on the savings you have and the money you can offer to start your company.
  • The financing of the three fs. Specifically: family, friends and "fools" (family, friends and fools). It consists of using capital that your own family, friends or people who believe in you give you for your company in such a way that you can get more money. Your participation can be based on loans, donations or shares in the company.
  • Crowdfunding and crowdlending. Be careful, because both are not the same. Crowdfunding are micro-patronage platforms. While crowdlending refers to people who offer money at an interest rate (a kind of loan with that person or company).
  • Subsidies. This is one of the best known, but many times you have to read the small print well to know if you are interested or not. Many times, it does not mean having money to start your business, but that you have to have other sources of money. And it is that these grants sometimes take too long to start and others require that the company is already up and running.
  • Loans. Both banking and participatory, that is, those that are made in exchange for having a stake in the company.
  • Contests for entrepreneurs. In case you don't know, in Spain prizes and competitions are often held whose objective is to assess business projects. The money earned in these is usually very juicy and sometimes it is enough to make the jump.
  • Lines for entrepreneurs. These are mainly from banks and ICOs that focus on entrepreneurs to offer them financing. That yes, to obtain it it is necessary that endorsements and guarantees are presented.
  • Business angels. They are people who decide to invest in business projects, that is, in projects of new entrepreneurs. In return, they not only receive an economic benefit, but they can also feel like "teachers" and get involved in making sure everything goes ahead.
  • Bonuses. For example, when hiring staff or in the self-employed's own quotas. It is a way to have a discount or cheaper labor thanks to those reductions in fees.

In reality, there are many more sources of financing and our advice is to take them into account because they can help your project have a financing channel that allows you to maintain yourself and even go further.

Go from less to more

When we have a business project in mind, it is common for us to think big. But this is actually the biggest mistake you can make. And it is because no project can go ahead and become something "big" when you don't have the necessary means: money, labor, communications, advertising...

Thus, When you start as an entrepreneur, you must go little by little, knowing that the first years are the most complicated and difficult, but once you get them to notice you, everything will be much better.

Build an emergency fund

Build an emergency fund

Something that very few entrepreneurs do is have a emergency fund. That is, money saved to deal with some problems that come unexpectedly. For example, that in the store they do not serve you the material without paying for it first; being robbed and having to change the window of your store, etc.

This, which seems silly, is actually not so silly because that way you will always have a cushion to deal with those unforeseen events without damaging the item of expenses and income that you have that month.

Always have a good financial strategy

Always have a good financial strategy

It can be the most tedious and boring, but in reality it is very important, and it is because this way you will ensure that all the data agrees and there are no accounting problems or money lost in the company.

By controlling both expenses and income, you get know how you are managing money and if you can save on anything.

Although these may seem like basic tips and that anyone will carry them out, the reality is that many new entrepreneurs jump "into the pool" without taking these tips into account. And sometimes it's a big mistake.


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