Many potential entrepreneurs are discouraged because they think that there’s no way that they can get enough money to start their own business.

The fact is that very few businesses are funded out of pocket. You don’t have to be rich to start your own business.

Here is a look at how you get the money to make your dream business a reality:

1. Angel Investors

People who have made a lot of money through their own business ventures often look for new startups to put money behind.

They absorb the financial risk of starting a new company while also being able to offer guidance based on their own experiences. Many of the biggest companies in the world were funded through angel investments.

If you want to be connected with an angel investor, you should look into networks such as:

2. Bank Loans

use bank loan to raise money for business

Bank loans are the most common way that small businesses are funded.

If you want a bank loan for a business, you have a few different options.

When you meet the Small Business Association’s criteria, they will guarantee as much as 80% of your loan.

Or, if you own any major assets such as a house, you can use that as security to help get your loan approved.

3. Venture Capital

If your business idea is in a field with a lot of potential for growth, venture capital might be your best bet.

Venture capitalists will fund your business in exchange for equity and debt financing.

Although most businesses funded by venture capital fail, venture capitalists continue to invest in businesses since a few big successes more than make up for a few smaller losses.

4. Crowd Funding

Crowd funding is a relatively new concept, but it is one that is gaining a lot of popularity.

Many ambitious ideas are being turned into a reality by raising money on sites such as Kickstarter and Indiegogo. Crowd funding sites allow people who are interested in the project to give money to it, typically in exchange for a reward.

Although traditional investors might be discouraged due to the lack of equity-based funding, novel ideas gain a lot of traction on these sites due to the excitement of people who want the product that is being funded.

5. Business Partners

You might not be able to raise enough money to start a business on your own, but a business partner might be able to.

However, you should be certain that your business partner has the same vision for the business that you do.

You should also have a plan in place if your relationship with your partner goes south.

Although business partners are an effective way to fund your business, poor planning can lead to a disaster down the road.


Do not allow worries about funding to stop your business idea from becoming a reality.

There are many individuals and organizations out there who are looking for the right idea to put money behind.

When you know what you’re looking for and are prepared with a plan, you can get your business funded in no time.