How do I raise startup capital?

Funding is essential for every business. Many entrepreneurs begin their business by bootstrapping. Bootstrapping is the process of funding your business with personal funds or funds from friends and family. Eventually, there will come a time when you need to pursue external sources of funding.

The following are a few sources of capital to consider:

  • Grants: A type of funding where you receive non-repayable funds to invest in your business. The Capital Catalyst Grant, Ideavance, and SBIR grant are a few common examples.

  • Equity Funding: When you pursue equity funding, you receive money in exchange for issuing shares of stock. Venture capital and angel investments are two examples of equity funding.

  • Debt Funding: When you pursue debt funding, you borrow cash that you will later have to pay back. An SBA loan, bank loans, venture debt, accounts receivable-based credit lines, and asset loans are all examples of debt funding.

  • Competitions & Contests: Startup founders can apply and participate in competitions and contests in the hopes of winning cash prizes and in-kind services.

  • Accelerators: Startup founders can also apply for start-up accelerators and participate in a fixed-term program that often includes seed investments, mentorship, and education.

The right type of funding will depend on your business and owner’s preference. If you are not sure what type of funding is right for you, contact us or another business coach to seek advise.