Millions of business ideas emerge every second all over the world. Ideas that can revolutionize people’s lives, social structures, and even the economy. Unfortunately, most of them are forgotten due to lack of support and, above all, lack of money. The funding of a business is one of the most critical assignments and, at the same time, one of the most problematic.
If you have a powerful idea, stand up and fight for it. This includes its validation, business model development, and of course, obtaining capital to fund it. Building a solid and profitable startup is not an easy task; it requires hard work and discipline to generate operating formats and administrative processes according to the needs of today’s consumers.
Several funding sources are available for new entrepreneurs, from access to financial products such as an ITIN loan to out-of-the-box alternatives such as crowdfunding. Here are some options to consider when raising capital to establish a successful business.
Funding alternatives for startups:-
- Personal Saving: According to JPMorgan Chase & Co70% of Latino-owned businesses are financed with this alternative. It is undoubtedly a practical option, but it prevents companies from generating a good credit history, a fundamental aspect of the growth of any business.
- Friends and family loans: This alternative is also widely used since, in most cases, they do not charge interest rates, or if they do exist, they are minimal. It is essential to consider that mixing business and family can bring problems in the future.
- Credits and loans: Using these financial products allows you to set the course of the venture according to your criteria. It is vital to analyze the options in the market until you find the one that fits your needs and payment possibilities.
- Angel investors: These are people who invest in companies in exchange for convertible debt or ownership of a part of the company. This type of alternative can enhance the organization since they usually have significant experience and vision of the business world.
- Crowdfunding: Fintech companies serve as a digital platform to raise capital in exchange for rewards for people who support the cause. They are usually used for disruptive projects with social impact and have become very popular nowadays.
Why is it important to raise money for your business?
Capital allows any business to maximize its advantages and opportunities and solve its failures and weaknesses. But remember that capital is not everything; it is necessary to have a solid project with a defined strategy and good budgeting; your should use every penny properly to achieve the expected results.
All funding alternatives have advantages and disadvantages; we recommend you analyze the needs of your project before choosing one. If your startup has a social context, getting a private or public grant is a good option. If it is focused on technology, angel investors or private equity funds may be the answer, and in case it is a business where you want total control, financing such as ITIN loans is the answer.
What are ITIN loans, and how can you access this option
These are financial products offered by online lenders; their main characteristic is that they do not require a social security number to be granted. But they do require the presence of the IRS Individual Taxpayer Identification Number (ITIN), a requirement that can be obtained by all individuals, regardless of their immigration status.
In addition to this primary requirement, getting ITIN loans requires registering your company as a DGA (doing business as) with the local authority and having a business bank account. These financing products satisfy the capital demand of immigrant-owned companies since no company, no matter the niche, should limit its potential due to a lack of resources.
Achieving the startup of your dreams is closer than you think; focus and hard work will be the weapons to defend your personal and professional goals. Generate a business plan, establish your business objectives and the path to follow to achieve them, raise capital through one of these alternatives and start a company that will leave a mark in your community.