You have a small business or a great idea for one. You feel confident that this will fly and make money. You have a rudimentary business plan but no money. Maybe you have bad credit and you need financing. I have been there several times. I found that the easiest way to get financing for a small business is regular people. Like friends and acquaintances.
The risk is losing friendship and having your family turn against you. Money controls most things in life. But - if you can't get financing through a bank or other normal sources - this is the way to go. If you are willing to take that risk.
Why would regular people lend you money they have worked hard for? Mostly because you are you and they like you. NOT your business idea. So rule number one is to approach only people that you know like and respect you. Borrowing personal money is different from having to prove your self-worth. It's mostly based on personal liking and trust. People like to help people they like. And they will. Many people also feel if they don't lend you money you won't like them any more. This is a real test of friendship and it can backfire.
Secondary is the obvious desire to make money. Most people are willing to take some risk to get a return on their investment. Pending on the wealth of the person - a loan for $5-10,000 is not a huge thing. Any more than that - and you better have a great plan. If your business plan is highly capitalized - you need to re-think this approach.
Before you approach your targets - prepare a little bit. Try to establish if they are ABLE to lend you the amount you ask for. It's a complete waste of time to ask for $5,000 if the family is scraping bottom every month. Don't do it. But if you know that the famil is strong financially - go for it.
Your initial approach should be in the form of a letter. This is what I have done and it works. Write an intriguing but honest letter. "We have only known eachother for a few years Cheap Adidas Ultra Boost Uncaged Men's New Black , and I thought you'd be interested in a project I have worked on for a while."
Then give them a very brief outline of the business: "Basically, I have discovered that many engineers in our states have very poorly performing web sites. I know I can help these company grow their business by creating compelling web sites that will sell their services."
Then you go for it: "What I am proposing to you is to help me market this concet. To do this successfully I need some funding for a direct-mail marketing campaign. I am asking for $7,250 to spend as follows:......"
Then you must give them a carrot - a potential return on their investment. There are a couple of ways this can be done. I have used a percentage of gross revenues with success. This means that they get let's say 5% of gross revenues for a few years Adidas Ultra Boost 4.0 Men's White Black Cheap , and then the loan gets paid back. You have to estimate what that revenue can be before you settle on a percentage. So if you figure out you could make $100,000 the first year, and you are asking for $5 Adidas Ultra Boost Clima Grey Men's Cheap ,000 - a 2-3% of revenues is not out of line. Remember - you are NOT going to ask for a bank-rate loan. If you can get a bank loan - get one. If you need financing and you have bad credit - IT WILL COST YOU. And is should.
The bottom line is: They will lend you the money first because they like you. Because you are part of their group. They trust you. NOT because your business idea is so great. I have found that most people I have borrowed from don't even understand what I do.
Then you pay them as agreed - and you can go back many times to your own private bank for business financing.Home Businesses: Important Steps To Make Extra Money From Home Posted by nick_niesen on October 28th, 2010
There are many ways to make money at home. You can either start your own home business or apply at a company that employs people who can work from home..
The most common ways to make money at home is by starting your own home business. Because of the internet, it is now possible for people to communicate faster wherever they are in the world.
Be realistic, starting your own home business does not mean that you can become a millionaire overnight. Determine how much extra money you want to earn and how much you are willing to invest.
Research what kind of home business you are willing to consider. Make a list of these businesses and try to figure out what suits you best and figure out the demands for each kind of business. Choose one that is easy to set up and one that does not require you to invest a lot of money.
Choose one that does not need much maintenance, for example Cheap Adidas Performance Women's Ultra Boost W White , perishable goods like fruits and vegetables are a great income generator, but there are too many competitors and it also requires you to spend large sums of money for storage.
Look for a business that does not need these kinds of special care. Remember, you are in a business to make money not lose it.
Since we can communicate with anyone from around the world, you can look for a business that exports quality handmade products that are cheap. You can then import these products and sell them by using the internet with a larger price tag.
Mamis mit Herz
Thema drucken
26.12.2019 06:24
Antworten
