Hello Hivians, welcome to my blog. In this post , I will try to highlight to highlight on how to source for funding for start-up projects. Emphasis in this log would be on Bootstrapping. I never ad access to them when I started business but in the course of time, I've learnt over the years and I've leveraged the knowledge for the start-ups I incubated.
At the beginning of almost every business, entrepreneurs find themselves asking – How do I finance my startup? "Startup capital" is a term that makes every entrepreneur go into seeking the best funding options available. The capital is needed for the implementation of the novel idea.
I could vividly remember how difficult is was to raise funds for my business in 2011 as a young school leaver. This was hinged to the fact that I was limited in knowledge to the various available funding options for start-ups. It is important to fore-mostly understand what's going on in our world as it concerns Capital funding of a business, project or idea. We are in a new world and so many things have changed.
Facts and Expectations
Some assert that that over 94% of new businesses fail during first year of operation. One of the common reasons is lack of funding turns. This is because "Money is the bloodline of any business". Most brilliant startup ideas have been buried due to the absence of startup capital.
First things first
Many times we get so worried about raising funds that we forget to draw a budget for the project. What is Business Budget?
- Estimate cost is the cost of all the activities needed to set of the business (we may say, hard cost + soft cost). This is likely Cash Flow Projection and Analysis.
- Contingency Reserve is the money sets aside to handle all the know risks of your business. This is the known Unknown.
- The Management Reserve is the money sets aside to handle risks that are not know but can happen by chance. This reserve is the Unknown Unknown. An example of Management reserve is the money set aside the government to handle Covid-19.
What is Bootstrapping?
Bootstrapping involves the build of a project or a company from the ground up with nothing but personal savings, and proabably the cash coming in from the first sales. For an entrepreneur, bootstrap, used as a noun is one entrepreneur who launches his project with little or no outside cash or other support.
Funds raised by bootstrapping would constitute your "equity" in the business or the project. EQUITY generally refers to the value of an ownership interest in a business, such as shares of stock held. This defines the possible future control of the business.
If as an entrepreneur, you believe in your vision and have an absolute refusal to accept failure as an option, you should feel comfortable investing your own money into the business. This is what bootstrapping is all about. It brings little no drama in the future.
Idea Pitching on a Crypto-backed Social Blogging Platform
Thanks for blockchain technology that has brought more meaning to social blogging and helps new users to earn without investing a dime. An entrepreneur can maximize a blockchain-powered social blogging platform like https://steemit.com to pitch an idea which could help to raise funds for a business or project start-up.
In pitching your ideas, you may need to break the project idea in sub-themes in order to earn more funds. Pitching your idea is meant to give people reasons to fund you without expecting anything in return. It is not a pres-sale and neither a crowdfund. Only blockchain-powered blogging platforms can help achieve this.