The E-Commerce market was estimated at nearly $1.6 trillion in 2015. Making your startup dream is certainly exciting and potentially very profitable. You have a specific niche, developed a winning strategy, and you even outlined website ideas.
However, one element remains. How do you fund your E-Commerce startup? There are pros and cons to all funding options, and analyzing them in depth is vital to the growth of your business.
From bootstrapping to angel investors, let’s take a closer look at the powerful ways you can fund your business idea.
1. Bootstrapping Your E-Commerce Startup
If your business is lacking investment potential, bootstrapping may be the best plan of action. In fact, 82 percent of 2014 startups were self-funded, according to Entrepreneur. Though there are challenges involved with using bootstrapping to fund your startup, big benefits remain.
The biggest benefit is you don’t have to include investors in profits. Sure, profits may be a little ways down the road, but they are all yours to enjoy. Using bootstrapping to fund your E-Commerce startup also allows you to become a very creative CEO.
There is plenty of bootstrapping success stories out there, according to Forbes contributor and Co-founder of Web Profits, Sujan Patel. Patel suggests, “If you have an idea, don’t rest on your laurels. Get out and get started.”
2. Fund Your E-Commerce Startup with Family and Friends
After launching your E-Commerce website, you’ll find your first customers to be family and friends. It’s certainly fantastic to have support, but why not get family and friends in on the ground floor?
In fact, 24 percent of startups get funded through family and friends. A survey by Fundable, a crowdfunding platform, found that, “friends and family invest the most money in startups in aggregate, investing over $60BB per year.” And the average annual investment by family and friends was $23,000.
3. Tapping Into Private Lenders
Tapping into private lenders to fund your startup is a superb strategy. There is certainly nothing better than having a private investor wanting to give you enough money to make your vision a reality.
And contrary to what many think, there are plenty of private lenders out there in the world ready to fund great ideas. However, not all private lenders are the right choice. It is vital to the growth of your E-Commerce business that you don’t jump on any private lender offer.
4. E-Commerce Startup Funding Via Venture Capitalists
A common source for funding is via venture capitalists. Venture capitalists will certainly have the means to fulfill your funding goals. This is simply because they have more investable equity.
Even Kobe Bryant started a $100 million venture capital fund, according to the Wall Street Journal. However, venture capitalists generally don’t share your startup passion. It is simply about profit.
5. Crowdfunding: Fantastic Way to Fund and Raise Brand Awareness
You may have a powerful E-Commerce startup idea and strategy, but without the funding to make it happen, it simply remains an idea. Crowdfunding is an excellent way to meet your funding goals and raise vital brand awareness.
6. Take Advantage of Angel Investors
Taking advantage of angel investors to fund your idea is certainly a powerful strategy. If you can craft a solid business plan, you will certainly get the funding you need.
According to Forbes, “The typical angel investment is $25,000 to $100,000 a company, but can go higher.” You will also have access to business savvy influencers who surely want to see a return on their investment.
7. Fund Your Short-Term E-Commerce Startup Goals with Credit Cards
Using credit cards to fund your startup is ideal for attaining your short-term goals. Unlike angel investor and venture capitalist investments, you will retain 100 percent of your company. However, this can be a slippery startup slope if you don’t use your credit balance wisely.
Fund your dream and turn your vision into your new daily life. These powerful funding strategies all have their pros and cons. But with a bit of business research and savvy negotiation skills such as communication and planning, your startup will get funded and grow. Take your funding to the next level and begin building your E-Commerce growth strategy today.