How to Look for Startup Money for Your Computer Business
Anyone who wishes to start a computer business will always have two words in mind: ‘how much?’ While the computer industry remains robust with a huge potential, many entrepreneurs dreaming to be the next big computer don will find that in order to gain entry into this market, you will have to spend. If your mission is to find funding for your computer startup business, here are some information you might find useful:
Determine the best source of money for business funding.
There are several sources of startup money you can use for your computer business. You might want to look at several to determine which one is most feasible for your needs. These are:
Personal savings. Personal savings are the quickest and easiest source of money for a startup business. For one, you don’t have to pay anyone back and won’t be under a lot of pressure because the responsibility rests on no one else but you. On the other hand, if you use personal savings, you could deplete your nest egg severely or, you may not have enough saved to fund your capital.
Personal loans. Another good source of funding is a personal loan. You could obtain this from family or friends. Just make sure to treat these personal loans with seriousness and respect. Just because the money is obtained through friendship or family ties does not exempt you from paying on time and as agreed upon.
Credit cards. Credit card companies do offer loans but the amount will be determined by your capability to earn (and therefore pay) and your credit standing. Should you go this route, be careful about the payment terms, interest rates and repayment schedules. Credit card companies tend to be rather unforgiving when it comes to loans. If you default, it could affect your credit standing negatively.
Angel investors. Angel investors are individuals that like to invest in business startups. If your business focuses on computers and technology, you’re in luck. Most of these private individuals like businesses that offer high-tech solutions because they have the most potential for rapid growth. Many of them work as a network. You could get in touch with them through your chamber of commerce, a small business development agency in your area, online or through ads in the papers.
Bank. Banks can offer you a variety of loans to suit your needs, whether you require money to purchase inventory, supplies, equipment or real estate. Check your local bank for the types of loans available to a startup business such as yours. A loan officer can guide you on what you need to know – requirements, qualifications, amount of money you can loan, payment terms, etc.
Depending on the type and amount of loan you want, a bank may also require collateral from you in the form of personal assets.
Support your venture with a business plan.
Unless you can find someone to loan you the money for your computer startup business, you will need a good business plan in order to obtain a loan or grant from most lenders.
If you’re planning to talk to a bank or a state funding agency, you will have to be able to show a business plan. For one, most lenders will require a business plan and for another, you’ll need this to help guide you on how much money you will need for your business. Without a business plan, you could either ask for too much or too little, which, either way will not be helpful for your business.