Chairmen’s RoundTable typically deals with clients who have at least $2 million in revenues. However, we recognize that many smaller organizations regularly run into funding challenges…especially during tough economic times. So as a public service, we’re pleased to offer a bit of friendly advice geared specifically towards start-ups and micro businesses.
The thing is, every great business begins with an idea and a single question: “How am I going to pay for this?” Because funding a small business isn’t just about money—it’s about strategy, timing, control, and risk.
The good news? There are more options than ever when it comes to filling your coffers. The bad news? Not all of them are right for you. With all this in mind, here are twelve practical—and very different—ways to get your business off the ground.
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- Bootstrap It (a.k.a. You Fund You). This is the purest form of entrepreneurship. You use your own savings, your own credit, and your own grit. You keep full control, but you also carry all the risk. It’s not glamorous—but it’s how many great businesses start.
- Friends and Family. The original investors. These are people betting on you, not just the business. The upside is flexibility. The downside? Thanksgiving can get awkward if things don’t go as planned. Put everything in writing. Seriously. And once you have the terms of a written contract in place, STICK to them. Don’t look for special dispensation merely because they’re real or extended family.
- Credit Cards. Fast, easy, and dangerous. Credit cards can help you bridge early expenses, but high interest rates can quietly eat your business alive. Use them sparingly—and strategically. And don’t be like a fellow I once knew who got all kinds of credit card applications in the mail, filled them all out, used them, and was then shocked – SHOCKED – that he had to pay them back.
- Bank Loans. Traditional financing through a bank like Endeavor is still a viable path—if you have solid credit, a comprehensive business and marketing plan, and loads of patience. Expect to jump through a bunch of hoops, and recognize you may not get what you want from the first bank you approach. Oh, and there’s going to be paperwork. Lots of it.
- SBA Loans. Backed by the U.S. Small Business Administration, these loans reduce risk for lenders and make it easier for small businesses to qualify. Lower rates, longer terms—but still a process. As much paperwork as you had with the bank, plan to double it with the SBA.
- Angel Investors. These are individuals who invest their own money in early-stage businesses. They often bring experience and connections along with capital. But remember—you’re giving up equity and some control. You can easily expect these guys to demand a seat or two on your board of directors so they can protect their investment.
- Venture Capital. If you’re building something scalable and high-growth, venture capital may be an option. Firms like Sequoia Capital look for big ideas with big potential. Be prepared to move fast—and give up a meaningful piece of your company. Still, owning ten percent of a huge operation may be better for you than owning 100% of something tiny.
- Crowdfunding. Platforms like Kickstarter and Indiegogo allow you to raise small amounts of money from a large number of people. It’s not just funding—it’s marketing, validation, and community-building rolled into one.
- Grants. Free money—if you can get it. Government agencies, nonprofits, and corporations offer grants for specific types of businesses (especially in tech, sustainability, and community development). The competition is fierce, but the payoff is real.
- Strategic Partnerships. Sometimes the best funding doesn’t come from a lender—it comes from a partner. A supplier, distributor, or larger company may invest in you to secure a long-term relationship. This means you need to think beyond cash and start considering potential leverage.
- Revenue-Based Financing. Here’s one you might not have considered. Instead of giving up equity, you repay investors with a percentage of your revenue. It’s flexible and aligned with your cash flow—but it can get expensive over time…especially when you hit it big!
- Pre-Selling Your Product or Service. One of the smartest—and most overlooked—strategies. Sell before you build. Whether it’s subscriptions, deposits, or early-bird pricing, your customers become your investors. If they’re willing to pay upfront, you’re onto something.
Here’s the bottom line, as it were: there’s no “right” way to fund a business—only the way that fits your goals, your risk tolerance, and your vision. Some founders want control. Others want speed. Some want safety. Others are comfortable swinging for the fences.
Meaning that the real trick isn’t finding money to keep your business, but finding the right money—at the right time—for the right reasons.Because how you fund your business will shape what your business becomes.
And in a couple of years – when you’ve stabilized and you’re seeking serious brain power to grow to the NEXT level – that’s when you apply to become a CRT client.
