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How to raise money for your small side hustle is a simple post showing you the many ways you can fund a small business without taking out business loans from the bank. Bank loans are scary and you can avoid them and still get money for your side hustle.
20 Unconventional ways to raise money for your small side hustle
Raising money for a small business often requires thinking outside the box. Here are some unconventional methods to consider:
1. Crowdfunding:
Reward-Based Crowdfunding: Platforms like Kickstarter or Indiegogo allow you to raise funds by offering rewards or pre-selling products to backers.
Equity Crowdfunding: Websites like Crowdcube or Seedrs let you sell equity shares of your business to a large number of investors.
2. Grants and Competitions:
Business Plan Competitions: Entering competitions where you can win prize money to fund your business.
Small Business Grants: Seeking out grants from government agencies, non-profits, or private companies that support small businesses.
3. Peer-to-Peer Lending:
Using P2P lending platforms like LendingClub or Funding Circle to borrow money directly from individual investors.
4. Microloans:
Applying for small loans through organizations such as Kiva or Accion, which offer microfinancing for small business owners.
5. Bartering Services:
Trading your products or services with other businesses to save cash and build relationships.
6. Social Media and Online Communities:
Leveraging platforms like Patreon to gain financial support from fans and followers in exchange for exclusive content or services.
7. Pre-Sales:
Offering products or services for sale before they are available to raise funds for production or development.
8. Angel Investors:
Seeking out individual investors who are willing to invest in small businesses in exchange for equity or convertible debt.
9. Incubators and Accelerators:
Applying to business incubators or accelerators that provide funding, mentorship, and resources in exchange for equity.
10. Selling Intellectual Property:
Licensing your business’s intellectual property or selling patents to generate capital.
11. Family and Friends:
Asking friends and family for loans or investments, often under more favorable terms than traditional lenders.
12. Leasing Equipment:
Instead of buying, leasing equipment to free up capital for other business needs.
13. Partnerships and Strategic Alliances:
Forming partnerships with other businesses to share resources or co-develop products.
14. Bootstrapping:
Reinvesting your own earnings into the business to grow it without outside funding.
15. Invoice Financing:
Using invoice financing companies to get advances on outstanding invoices, improving cash flow.
16. Sponsorships:
Securing sponsorships from larger companies in exchange for promoting their brand.
17. Franchise Model:
Expanding your business through franchising to generate upfront franchise fees.
18. Product Licensing:
Licensing your product to other companies who can manufacture and sell it, earning you royalties.
19. Freelance or Side Gigs:
Earning additional income through freelance work or side gigs to fund your business.
20. Selling Unused Assets:
Selling personal or business assets that are not essential to your operations to raise capital.
These unconventional methods can provide creative and effective ways to secure funding for your small business, often with less reliance on traditional financial institutions.
