Thu, 1 June 2023
What Type of Funding Should You Seek
When raising funding consider the type of funding you should pursue.
There are many types of funding such as equity funding including angels and venture capitalists.
There are debt funding tools including loans and revenue-based funding.
There are crowdfunding portals including rewards, equity, and peer-to-peer lending.
Before choosing a type of funding, consider the following:
Investigate each type of funding and consider where it may fit into your overall funding plan.
It’s most likely that you will use two or three types of funding over the life of your business.
To understand the type of funding you should seek ask ‘how you will pay the investor back.’
If you plan to pay back when you sell the business, equity funding is an option.
If you plan to pay back out of the business's cash flow, then debt funding is an option.
If you have a consumer-facing product, consider crowdfunding, which offers both debt and equity options.
Break your funding down into component parts and consider using more than one type of funding for your business.
Thank you for joining your host Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.
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