Larger businesses often have access to a wide variety of funding options—including investors, shareholders, or previous business reserves—and can usually draw from these sources. This isn’t the case for most solopreneurs and small businesses, which can have a difficult time obtaining needed resources.
No matter how efficiently a company uses its available funds, if there isn’t enough money available, projects will stall. Fortunately, there are a number of less-standard techniques for fundraising that can help smaller teams.
To find out more, we asked members of YEC Next the following question:
What is a lesser-known way of raising funds when you’re a solopreneur or small business?
1. Offer value in exchange of funds
Offer equity. In other words, make your team members acquire as much value as yourself. This will also allow them to view the company as their own and will make them work harder to reach common goals. —Jose Magana, Yellowberry Hub
2. Get a business credit card
As a solopreneur, you might not have the time required to be approved for the business financing that you desire. Nowadays banks have new application offers. You could get approved for a zero percent introductory interest rate card and use it as a free-money loan. It will give you a period during which you pay no interest on your balance while you fund the initial start of the business. —Jessica Baker, Aligned Signs
3. Sell a related service
If you’re just starting out as a solopreneur or with a small team, you will not always be able to get investors. It’s hard to fundraise an idea. What you can do is offer a service that is related to what your core product will be. If people pay for your service, you can establish positive working relationships for the future for when you eventually roll out your main product. —Kyle Wiggins, Keteka
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4. Look into small business loans
In my experience with fundraising, it’s all about relationships and previous fundraising that you’ve done. It’s a little harder for solopreneurs because most VCs want to see a co-founder who can keep you accountable and push your idea forward. For this reason, I would recommend looking into small business loans or lines of credit, because you also get to keep your shares. —Anna Anisin, Formulatedby
5. Make use of invoice financing
Invoice financing is a great way to raise capital if you’re a solo entrepreneur. This allows you to receive funds which would ordinarily be held up in a client’s account payable by working through a financing company to mediate the exchange. Generally you can get as much as 85% of the total fee from the financing company, and the rest (minus lender fees) when the client finishes the deal. —Bryan Driscoll, Think Big Marketing, LLC
RELATED: The Secret Weapon That Can Help You Get a Better Business Loan
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