Business
Mastering the art of self-funding your business
While it is widely-accepted that small businesses are key drivers of economic growth in the UK, there is still a tendency to underestimate the full impact of independent ventures.
After all, SMEs currently account for a staggering 99.3% of all private sector businesses, while they also employee 15.7 million people nationwide.
Despite the obvious and increasingly important role that SMEs play in sustaining economic growth, however, successfully launching your start-up remains a difficult challenge in 2017. This is particularly true when self-funding, as while this helps you to retain control of your venture it can be exceptionally hard secure the required capital.
In this article, we will discuss some creative and effective ways of self-funding in the digital age and consider which one is right for you.
- Maintain your day job while you launch your business
While it may be tempting to immersive yourself fully in your new business venture, this may not be the most sensible option when you have limited capital with which to work. In fact, choosing to retain your day job and a reliable source of income can provide considerable support when launching your business, regardless of the personal sacrifice that is required to make this work.
When combined with a stringent budget, this approach can sustain a source of disposable income for longer and optimise the amount of money that can be invested into your start-up. All that is required is a strong work-ethic and robust organisational skills, so that you can commit fully to the additional work and use your time wisely.
You can also adhere to this principle when initially formulating your business plans, as you look to create additional earnings prior to bringing your idea to life. In addition to performing your day job, you could consider marketing your skills as a freelancer and building a brand new (and potentially lucrative) income stream.
- Invest in the financial markets
The concept of creating new revenue streams is at the heart of most self-funding ideas, although some may not be viable depending on the nature of your day job. If you are required to work long days or in a stressful environment, for example, the idea of taking on additional hours could well prove fanciful.
In this instance, you would be better served by seeking out passive income streams. Investing in the financial market provides a relevant example of this, particularly as today’s online trading platforms are largely automated and boast an incredible wealth of technical analysis. A professional ECN broker can also provide you with direct access to other participants in the forex market and similar entities, enabling you to develop managed funds at minimal cost.
By embracing online trading platforms and ECN networks, you can build a strong trading portfolio that can be easily managed and largely automated. Over time, this can deliver considerable earnings that comfortably sit alongside your annual salary.
- Consider selling through affiliates to raise funds
Not every start-up is equal, and in some instances you may have a core product to sell but no tangible business infrastructure to support this. This should not come as too much of a concern, however, as it is possible to leverage and monetise your product and raise some much-needed funds.
The key is to consider selling your products through affiliates, or potentially licensing the idea to an established brand on a fixed-term contract.
The first idea would see you sell your product through affiliate and third-party websites such as Amazon, who can provide you with access to a global market in exchange for a fixed commission per sale. This enables you build both funds and a consumer base, as you look to develop your business infrastructure and launch a stand-alone brand.
Through a licensing agreement, you would agree for a similar and established brand to sell your product for a fixed period of time. You will earn a royalty for every unit sold, which can develop a growing revenue stream that is reinvested into your product and burgeoning business. At the end of your agreement, the rights will revert back to you and you can decide how to proceed from there.
