Securing funding for your startup business can be a tough hurdle to overcome. Thankfully for entrepreneurs, there are now several options to choose from.

After a couple of years of uncertainty, the cost of starting a small business has started to rise. There is good news on the horizon, though — many small businesses are expecting business to pick up in the coming year. 

And while more than 90% of startups are self-funded, there are options out there for securing outside funding to get your idea off the ground.

Of course, self-funded start-ups can keep complete control, and all of the equity. However, that’s not an option available to everyone — a great idea and a solid bank balance don’t always go hand-in-hand. If you’re looking for a little extra to get you going, here are some options.

Work with an investor

In exchange for funding your startup, investors will typically require a portion of the company or stock, or a guarantee that they’ll receive a percentage of the profits. The first step is to work out how much capital you need, how many investors you can take on, and what you’re willing to offer them in return for their money.

Keep in mind that this is not step one — many professional investors will want to see that you have secured non-personal funds from family or friends, as this shows credibility.

Get a bank loan or line of credit

To get a bank loan or credit, you’ll need a great credit history and solid business plans, including financial projections. But you may still struggle to secure a loan for a new business unless you are willing to put assets on the line.

You can also check out online providers who specialise in loans for small businesses. They can help you get your business started, and they can also offer advice on running your start-up — after all, it's in their best interest that you succeed.

Find a customer who will give you an advance

A customer or business that sees value in your ideas may be able to offer an advance on royalties, a white-labelling agreement or early licensing.

Look into incubators and accelerators

Universities, large companies and community development organisations sometimes offer incubators and accelerators for startups, providing resources including mentoring, office space and seed capital at little to no cost.

Consider crowdfunding

A relatively new source of funding for startups, crowdfunding campaigns allow entrepreneurs to reach out to a like-minded audience who are interested in investing in their product or service. Although altruistic crowdfunding isn’t unheard of for charities and individuals, you’ll likely need to offer something in return — think first-release products or special access to events.

Apply for small business grants and community assistance

Government support and community assistance are other ways to fund your startup. They can be highly competitive and involve a lengthy application.

This sort of support may also come from large businesses — Salesforce for Startups is a program that helps startups access resources and Salesforce products to get started the right way and grow quickly.

Pitch tips

If you get the opportunity to pitch to prospects, lucky you! Here are some quick tips:

  • Don’t ramble about everything you could do. Focus on how you will be able to help the prospect or your potential customers face their challenges.
  • When someone wants to interrupt, let them – they obviously need more information on a specific point to make their decision. They might let you know through their facial expressions or small gestures, so be on the lookout for small signals.
  • Don’t lose their interest – keep it short, focusing on the most critical aspects.
  • Ask for feedback throughout your presentation. Ask ‘does this make sense for your world?’ or ‘Could you see this applying to you?’. They will either give their tacit approval – beginning to softly close the sale – or they will ask for more information, giving you an opportunity to adjust your offering, making sure your presentation has been absolutely relevant.
  • Talk to people who have done this before, and who you have something in common with, to find out what they learnt along the way.

To find out what the landscape looks like for small and medium sized businesses, download the Small and Medium Business Trends Report.

This article was updated in July 2022