The Mindful Start-Up

Posted on July 6, 2011

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Financing a start-up company can be a confusing process in an unstable market.  In previous years, many entrepreneurs financed their start-up companies with their homes.  However, in the current credit crunch, it is increasingly more difficult to utilize this funding option.

For those without significant personal funds, all hope is not lost. It is more important than ever to have comprehensive business plans and make different options available to you and your investors in a market that is inefficient and unpredictable. Remember Do your research beforehand, and understand what your business can handle. A recent article on CNN Money addressed vital questions and concerns for any entrepreneur.

The most important people to keep in mind when financing your start-up are your investors.  It is helpful to scout for investors that will provide strong support during the early stages of your company’s growth.

Finding investors often requires extensive networking. Networking can introduce you to a large number of prospective investors. Relationships with these potential investors can be integral to your start-up. Investors are not only sources of capital, but also helpful outlets for feedback, so your business has the best plan appropriate for its size and function.

Another common sense element that is often overlooked when building a start-up is maintaining low costs, if you can. Being frugal in the beginning can add security to your start-up.

On the other hand, if your start up requires large capital, something to consider is seeking a larger capital raise at the outset that will prepare you for future, unexpected costs that are inevitable occurrences with a new company.

Overall, making a comprehensive assessment of your business needs, giving your company some cushioning capital, engaging in responsible business planning, and maintaining strong relationships with investors can result in a successful start-up venture.

Photo by nkzs.

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