11 Best Source of funding for a Business

Best Source of funding for a Business: Getting Funding for Business has dependably been an issue when beginning a business.

Understanding the Sources of Getting Funding for Business is cardinal to effective business operations.

Now, one of the greatest slip-ups you can ever make in beginning a business is to start with no source of funding.

So, in this article, I will be loking at sources of getting funding for business.

In the event that you are still searching for sources of funds for your business, here is the means by which to get them.

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Read also: Top 10 Grant Providers for Businesses 

Getting Funding

1. Get the Funds from Your pockets

The most effortless approach to Getting Funding for Business in Nigeria is to gather and save money.

In the event that you have a vocation, don’t leave it until your business is running independently.

Figure out how to balance your time between your work and your business for the time being.

This will give you the opportunity to do some basic things.

Things like registration, getting your brand to be well known brand character and startup capital can be dealt with the money saved.

Best Source of funding for a Business

Improvising stands out among the best and cheap approaches to guarantee a business’ cash inflow.

This implies less cash borrowed and as a result less interest to be paid.

Most startups in Nigeria began this way, working by the Lean Startup idea.

One noteworthy privilege and advantage is to manufacture a product that works and it will sell itself.

Following this makes the process easier.

See also: Top19 Business Doing Guide 

Best Source of funding for a Business

2. Source for Funds from Family, Friends and companions

In most cases when beginning, you require your family and companions to have the belief in you.

They are the foremost set of individuals who should approve your thought and bolster you.

You can approach them for support both technically and financially.

They serve as backbone in the process of getting your idea actualized.

Inspire them to trust in your thought, it sets you up surely.

This is indeed, another holistic way of Getting Funding for Business in Nigeria.

Best Source of funding for a Business

3. Obtain Business Loans

Before we continue, you ought to note that there are many credit structures.

The best practice for appropriate credit usage is that long term businesses should be funded with short term loans.

Short term businesses should also be supported with short term loans.

A deviation from the rule can bring about grave liquidity issues.

If return on investment of an asset can be made only after 10 years.

It will be a terrible financing choice to raise a credit that will be returned in 5 years to buy it.

This would imply that the cash to refund the credit would come from elsewhere.

The asset would not bring in enough cash to be able to refund the loan in 5 years.

In selecting from the variety of choices one would likewise need to consider the capital cost and the risk factor.

A few banks will bolster MSME’s with credit structures.

And they will prompt on what suits your business.

Read also: Top 20 business Gurus in Nigeria and their profiles

Best Source of funding for a Business

4. Apply for Grants

Grants are a kind of financial aid that don’t need to be refunded.

Grants are generally for non-benefit charity organizations however things are changing nowadays.

Grants have turned out to be one of the most secure methods for getting capital.

However they are just gotten by individuals who are increasing the value of the general public.

An example is CivicTech startup BudgIT, which as of late got $3m in grants

So you might try out applying for grants this year.

Best Source of funding for a Business

5. Source for funds from Investment/investors

Investment is the dedication and use of capital in a company with the desire that it will yield returns.

This is because of the scarcity of fund and other resources.

Investments become the viable alternative.

Hence, any choice taken in this regard, regardless of whether right or wrong, to a very large extent, affects the future development of the company.

Getting investors or seed stores for your business is not an awful thought.

This is very needful when you think your thought is “too huge” to be accomplished.

However, you ought to be prepared to give away some form of equity in return.

Regardless, to maintain a strategic distance from the threat of wrong investment.

It becomes increasingly important to audit painstakingly the financing of the company.

This also applies to the anticipated return on investment.

See also: Top 7 Business Capacity Building Tips in Nigeria

Best Source of funding for a Business

6. Make use of Social Intervention Fund of FG

A sum of N6 billion was assigned under the Social Intervention Fund in the 2017 budget.

The requirement for accessing the fund includes being a member of a business organization.

The money is for artisans and proprietors of small scale businesses.

The artisans and business proprietors can only access maximum of N100, 000.

This is at a three percent interest rate span across a year length.

Best Source of funding for a Business

7. Go to Oxfam

Still interested in Getting Funding for Business in Nigeria? Go to Oxfam.

Oxfam has various categories of funds for Nigerian entrepreneurs.

Oxfam, a universal confederation of charity organizations set up with the aim of easing worldwide destitution.

As of late dispensed €100 million to assist SMEs in Nigeria through Nextzon.

8. Key into Tony Elumelu Fund

Tony Elumelu Foundation has $100 million for 10,000 African business visionaries.

This will keep on being accessible for another seven to eight years.

In the event that you are in agribusiness, fashion design, light assembling, ICT, and strong minerals, among others.

Then apply for the on-going Tony Elumemu fund.

You can be lucky to be one of 1,000 business visionaries to be shortlisted.

Through the Elumelu support, Momarr Mass Taal, the CEO of Tropingo Foods in The Gambia, who got $5,000 seed capital in 2015, transformed his business into a $1.2 million income business.

Read also: 7 Tips to Develop Saving Plan Business in Nigeria

Best Source of funding for a Business

9. Make use of Bank of Industry (BOI) Funds

If there is a place where business owners can get cheap funds (usually at 9% loaning rate), it’s from the Bank of Industry (BOI).

This development finance institution (DFI) has been adjudged by numerous local and worldwide offices as one of the best oversaw banks on the planet.

The BOI has various funds that business owners of all levels can get.

To begin with is the Graduate Entrepreneurship Fund (GEF).

This is designed for graduates serving under the auspices National Youth Service Corps (NYSC).

Candidates are permitted to present their business thoughts, which are then checked on by a group of specialists.

The NYSC individuals whose thoughts are attractive and bankable are then chosen, prepared for four weeks and then given between N500,000 and N2 million.

See also: Top 30 Man-power Business

Best Source of funding for a Business

10. Other Sources:

There are likewise the Cottage Agro Processing (CAP) Fund for agro processors.

There is also Nolly Fund for players in the Nollywood industry.

In addition, we have Fashion Fund for fashion designers and different players in the value chain.

Indeed, the bank has other funds, a fund for the automobile industry inclusive.

Through 122 business improvement specialists.

Business owners can have access to funds effortlessly.

It is likewise simple to inquire about the bank’s products through its website.

The bank has a N5 billion fund from Africa’s wealthiest man Aliko Dangote to fund SMEs at a solitary digit rate.

Best Source of funding for a Business

Conclusion

For a fact, it is more secure to begin little and expand in order to attract investment and funds.

The first two alternatives are for the individuals who need to get started.

Take after the lean startup idea while the last two are for the individuals who need to expand and raise more capital.

What works is the blend of all choices all through the period of your business.

If you need a complete business plan, please let us know.

Or, you want us to help you set up this business, kindly contact us.

Otherwise, Please check out these other business ideas you can do.