Types of Small Business Grants, Loans and Funding for Entrepreneurs

Small businesses have various options when it comes to looking for money to support their startup and growth objectives. Once you've run out of 'friends, families and fools' to invest in your vision, you can look to extended funding opportunities that best fit your needs.

Here are some potential financing options and a quick overview to how they work:

• Repayable funding: This is funding where money is awarded to an entrepreneur with the intention of repaying it out of the revenues in future. Incase the value of the project is recognized to be reducing, then the grant is written off.

• Direct funding: With direct funding, cash is given out for activities such as training, employment or capital investments schemes so as to give back to the society. This type of funding requires the recipient to combine it with other funds they may have of up to 50%. Therefore, these funds help a lot in complementing any other source of money entrepreneurs may have such as loans.

• Equity grant: Under this type of program a sum of money is used to put up a business and the grant lender takes an equal share of the revenues, and if the business value increases the stake can then be returned. Equity finance lenders are also less demanding.

• Soft loans: These are special types of loans with much generous terms and conditions than other funding options, thus the word ‘soft’. Soft loans for instance, may have no interest to pay at all and if there is, the interest rates may be less and the repayment period could be long.                                                                   

Funding can be critical to the success of starting or growing a small business. The key is to be realistic about the short and long term goals as well as the increased business potential with funding in place. This way you can align the best possible funding solution that fits your needs and repayment terms.

Often small businesses need more than funding to be a success. Accelerators and Incubators can provide different levels of direct and indirect assistance through experienced advisors to help entrepreneurs get their businesses on track. For more on how Business Accelerators vs. Business Incubators can contribute to start up growth, check out How to Accelerate Business Success.

How to Think your Pitch Strategy

I recently read 'Pitch Anything' by Oren Klaff, whose impressive credentials in the business world include raising more than $400 million.  A highly recommended read that will make you look at pitching in a whole new way.

The thing that came to mind, as I was absorbed and fascinated by the methods he shares, was – you’ve got to have some real guts to take this on.  There are persuasive, quick thinking and on the spot tactics that come in to play, and that he describes brilliantly.

Which got me to thinking that how to pitch anything really starts with first having guts.  But what does having guts look like? Learning to get comfortable with presenting with guts means being able to take control and influence your outcome with a calm assertiveness. I broke it down to mastering the following key criteria:

Be Bold

It is not a congeniality contest. The goal is not to be nice and get people to like you. Know what you came in the room to do and present yourself and your pitch with conviction. Keep an unerring focus on the prize – i.e. leaving with what you came to achieve. And be compelling and clear when asking for what you want and why you should get it.

Be In Control of the Room

When you walk in to the room very quickly assess the interaction between key players. Stay attentive to their body language and actions during the presentation so that you can hold their interest in your pitch. At any point that you feel you are losing ground, don’t show that you are thrown off course. Take a couple of seconds if you need to and come back with something compelling to reengage. It requires thinking on your feet, which you need to get good at.

Stand Your Ground, Calmly

This does not mean that you ignore or not welcome feedback. It means being able to handle feedback with calm and confidence. Also, not allowing yourself to get thrown off your pitch or led into a direction that gets you off track from your goals. It goes back to maintaining control - first of you and, in turn, of the room.  Take a quick moment to collect your thoughts and reclaim your focus.

For an outstanding approach that breaks down dynamic methods for pitching in any situation, pick up a copy of Klaff’s book 'Pitch Anything.' It will help you think your pitch strategy at a whole different level; and get you used to presenting yourself a winner – and winning!

Marketing Success Tips for Startup Budgets

Creating a successful startup takes more than just a good product or service. Up-and-coming businesses require well-planned marketing strategies. To pull in a client base, it’s vital to create an identifiable brand, connect with prospects, and establish a solid industry niche.

Without ample financial resources, new businesses often find that marketing is hardest when they’re just getting started. Startups often face challenges when they’re getting off the ground. Their main concern is getting their product out in the world, but they don’t always have the financial means for a full-throttle marketing campaign.

Even a genius new product can flop if it fails to communicate its purpose or concept to consumers. In fact, great products often fail because they do not get the public attention they deserve.

SET YOUR BRAND APART

 “Your product needs an audience, and if you really want it to succeed, it’s best if you get the audience before you launch,” argues Manish Dudharejia in a Venture Beat article.

Before jumping into marketing, take some time to develop a strategy that will set your campaign apart from the multitude. It is essential that the concept is consistent, unique and fits with your company goals.

According to a MaRS report, startups often fail to realize that brand identity is “the glue that bonds customers to their product or service.” And yet in today’s competitive world, it’s more important than ever. Consumers are bombarded with about 6,000 ads a day and 25,000 products a year. That’s a lot of competition for consumer attention.

ZERO IN ON A SPECIFIC TARGET

Those unsure where to start are advised to think about who the prospective customers are. Companies can go much further if they zero in on a specific segment that is more likely to help business grow, according to a Mashable article. This might be a select community of early-adapters, similar to what Google did with the invitation-only release of its Google Glass. Focusing efforts on the most valuable group at first helps save resources and perfect a product’s flaws.

GET NOTICED & CONNECT

Publicity and attention is useless unless it can capture and convert an audience. The web makes it cheap and easy to connect with clients through tools like social media and email marketing. Social media already gets plenty of attention for its marketing benefits, but companies shouldn’t ignore the importance of email marketing. In fact, Monetate's Ecommerce Quarterly report found that email marketing had a 3 percent conversion rate compared with social media, which was calculated at less than 1 percent. The statistics were based on 500 million shopping experiences in Q1 of 2013.

But social media must be done strategically in order to bring success to your company. Facebook and Twitter aren’t just there for you to freely promote your product or business. You should post content that people are interested in seeing and that they will share with their friends.

Social media isn’t the only way to make a brand visible to a target community. Direct community outreach is a surefire way to get some attention. Startups can reach out to local media companies like newspapers or radio shows to see if they would be willing to offer promotional bits. Entrepreneurs can also participate in or sponsor charity events or local competitions to get more visibility and forge investor connections.

GROW SHARE-THRUS & COVERAGE

Once they establish an engaged client base, startups can encourage those customers to share their discovery. This could mean offering a discount for customers who “Like” a Facebook business page or tweet about a product. Contests and free side products are another great way to reach out. By eliminating “the obstacle of payment,” free products “have a way of going viral with minimal effort on your end,” according to Venture Beat. Freckle – a tech startup that developed a paid time tracking tool – used this method when it launched a free side product called EveryTimeZone, which tells users any time zone in the world at a glance. Despite its simplicity, the tool took off and got some valuable coverage on CNN and other media platforms.

ONLINE SEARCH & VISIBILITY

When it comes to online marketing, content plays a major role in a company’s visibility and search engine results. Every startup should develop a strategy for branded content. “Branded content is a great way to align your company with themes that are pertinent to your industry, and if you have something intelligent to add to the dialogue you immediately establish yourself as an expert,” suggests a Mashable report.

There are a few considerations to keep in mind when developing unique, branded content. Business executives should be sure to avoid a promotional tone and should instead focus on educational and relevant information that establishes them as a thought leader in the industry. Secondly, they should develop content that stands out amid the deluge of Internet media. In addition to publishing articles, creating a YouTube video or publishing a free eBook are two effective ways to accomplish this.

Startup businesses face a multitude of hurdles when it comes to marketing. Lack of financial stability or a client base makes marketing investments challenging at first, although this is alleviated by the possibilities afforded by the Internet.