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Raising Funds for Business Without a loan

It is possible to start that business you have always dreamed of without running to the bank to secure a loan. Find out other creative ways you can raise money for your business
Tap into your own money If you can’t invest in your own business, why should others? Moreover, who is the best candidate to get a loan from? The answer is you. Dip hands into your savings, home equity, or retirement accounts. It’s risky, but who cares. Go for it.

Knowledgeable investors want to see founders show confidence with cash. If you believe in your vision and have an absolute refusal to accept failure as an option, you should feel comfortable investing your own money in the business. Participate in entrepreneurship funding programmes These programmes are all over the place.Their purpose is simple: to encourage and support small business ownership, thereby creating jobs and fostering economic growth.Why not launch your Internet browser and start searching for one. According to, these programmes are like start-up competitions and they are willing to contribute to your business without demanding payback. Get a business partner
Don’t think you can go about your business alone and keep all of the profits for yourself. Although a few people have gone the sole proprietorship route and have been successful, the same can’t be said for many others. Why not spread the risks and responsibilities?  It’s good to know that there’s someone else who is as committed to the success of the business as you are.

However, before any partners have invested  significant time or money, you need a partnership agreement that sets out expectations and responsibilities. Decide who will do what, how these inputs will be measured, who has the right to make what decisions, how profits and losses will be shared, and what happens when partners disagree. The time to agree on these things is while you are all still friends.  The business world will test you and you better be prepared. Pay as you go This is a form of bootstrapping. Every profit you earn from early adopters and first set of customers is redirected back into the business or used to pay your suppliers (who supplied you on credit based on trust), and members of staff (who probably agreed to work for free in the first month).This means cutting down on excesses and delaying capital purchases.You might have to share office space or use your home, computers, hire on contract (instead of employing permanent members of staff). It is indeed a tough road, but not one you can’t survive in the beginning. Call a friend If you want to keep things ultra-simple, approach a supportive friend or family member, who might be willing to provide a loan. Funding from friends and family is a very popular and effective way to round up some initial capital for a business.
Make sure that you are not borrowing money that they can’t afford to lose. Put any lending agreement in writing with the terms clearly laid out even if it is a “friendly” loan. Crowd-funding Cooperative societies are the most popular source of crowd-funding in Nigeria. In a cooperative society, members of the society contribute the funds.

When adequate funds have been pooled, the members of the society then take turns in borrowing the money. If you belong to any cooperative society, you can leverage that platform to raise some funds for your business. Angel investing  After entrepreneurs have made their fortune in their own businesses, many of them look to support and invest their funds back into other start-up businesses. These are known as angel investors. They are not always some extremely rich people. They could also be friends or friends of friends. Attracting angel investors is a tricky business, and no matter how exciting and positive the initial conversations may be, the devil is always in the details. That’s why you need a good business plan. Also, ensure that you back up your valuation with real projections from your feasibility studies.
If you manage to impress an angel investor, they may provide investment in return for an equity stake.


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