Investor Routes For Startups: 5 Top Types

When beginning a start-up, there are many ingredients you’ll need to make it a success. A plan, the people, the equipment, the location, and so forth. But it all begins on one basic principle that you cannot get past – the money. And that means investor routes.

Money makes the world go round, as they say. Companies invest millions to create greater versions of themselves, attract more business, and stay alive for a good while. Whether it’s a restaurant, a conglomerate, or even a video arcade, these guys have game plans with their money.

Utilize Banks 

Banks exist for a reason. Sure, they keep your personal account safe and have safety deposit boxes. But they also have loan divisions that help out those trying to buy a car, a house, or, in this case, a business.

That means a small business loan to help get you started. Usually, they provide a strong amount of funding with an amount of time to pay it back. And interest, of course – banks need to make that money. The key here is to find a bank with a decent interest rate, but also one with a decent comfort zone.

That means, perhaps the longer it takes to pay back, the better. Some may be a little stingier with their investor routes, requiring five or so years for reimbursement. Others, however, are much more lenient.

Your best bet is to look around and see who offers what. It helps if you have an established bank you’ve already worked with for years, because, hey, they know you.

Call Someone Close to You

Believe it or not, you’d be surprised how many businesses succeed from within a family. Usually, mom and dad are happy to loan you some money to help your business soar. On the other hand, you may need to rely on a partner that’s within your circle of friends.

Either of these investor routes is a safe bet, mainly because they’ve known you for a while and know they can trust you. Sure, they’ll keep tabs on you and check in about the business to see what their money bought. But it’s a surefire way to get some money without extreme fees to pay back, or, worse yet, debt collectors.

This is a more personal option, so depending on your family situation, it could vary. But if your parents love you and will do anything for you, it couldn’t hurt.

Have You Checked With Public Investor Routes?

You’d be shocked to see what kind of money is ripe for the taking from the likes of grants and public funds. It could take a little looking around to find the right investor routes for you. Once you do, however, it’s easy to invest and make use of them in your business.

Sometimes they’re loans with very low-interest rates to pay back; but other times, they’re full-on grants. These are usually supplied by tech companies with a penchant for medical or drug creation, or building new tech. It can be a challenge at times to find the right grants that work for you. But they are out there, and it’s worth looking if you want an investor route that isn’t so heavy on payback.

Asking People Direct via Indiegogo or Kickstarter

Crowdfunding has a surprising amount of strength to it. Asking people for money to put into your idea is simple and extremely effective. That said, you’ll want to be careful when you go with the simplest of investor routes.

That’s because it could backfire. If you don’t set up proper goals or don’t have enough people believing in you, your campaign could fall flat. The next thing you know, you’ll have to give back the cash or have none to work with. So it’s vital that, if you take this version of the investor routes, you tell your people exactly what you’re selling. And what’s more, what they get out of it.

Venture Into Some Capital Funds

Finally, there’s another sound option working just as effectively as a bank. Venture capital funds are ideal investor routes, if only because they already have a huge amount of money set aside for up-and-coming businesses.

That said, you’ll need to “sell” them properly. Got a good idea? Put on a show with the presentation. Explain why they can’t live without your product and what good it’ll do for the community – or the world. Show them that you’re devoted, and you’ve got other team members behind you that share your vision.

Venture capital funds not only provide money but also resources that can prove useful in establishing a startup. So make sure you don’t brush this off, or any of the other investor routes. They’ll help you get off the ground and on your way to business victory.