Top 7 Genuine Ways to Raise Capital For a Small Business in Nigeria

One Of The biggest challenge any Entrepreneur or Businessman/woman would face is how to raise Capital To start up a business. It doesn’t matter how profitable you think the proposed business is, doesn’t matter how little the money you needed to start is – once you’re not able to raise money to start the business, the business can never be started.

Raising money for a business is the biggest achievement any aspiring Entrepreneur or Businessman/woman could make. Because with my little research, I think there is no genuine business without Capital.

I’ve seen a lot of cases where business ideas die due to inability to raise up Capital to make it come to reality. But today, I am going to give you some useful tips on how to raise Capital for a small business in any part of the world.

7 Ways to Raise Capital For Small Business

1. Personal Savings:
The best person to give you money is yourself… If you plan to start a business soon, start saving for it now. Open a savings account in any bank and start saving bit by bit, spread your savings over the period of time you intend to kick-start your business and make it a target to save a certain amount periodically.
To be able to achieve this, you’ll need to be resolute and disciplined. Cash demanding Problems may come along the way, look for other means to solve them — ask yourself ‘what if there are no savings what would you have done? Go with whatever answer you get and use it to solve the problems instead of using the saved fund. With this, you will be able to raise money for business through personal savings.

2.Take Advantage Of Social Media & Word Of Mouth Advertising: 

Social media has more than proven itself as a reliable tool to promote any business. Today, many fashion boutiques sell their items through Instagram, some through Facebook, and others through both.
Depending on what you’re offering, there’s always a social media platform with your target audience. If you have 1000 followers on Twitter, start with that. By promoting to a closely targeted market through your social media account, you would be spending far lesser cash to promote it than you would have.
Remember: Social media and word of mouth advertisement can be highly effective and free!

3. Co-Operative: 

The type we normally refer to as “Daily Contribution” It can be daily, weekly or monthly contribution — look for a group of people with common interest and start the contribution with them. This is similar to personal savings, the only thing different is that others are involved.
Each time you contribute, someone among you take it — do it until it reaches your turn. When you get yours, quickly put it into the business before other expenses carry it off.
Everyone in your co-operative must be people you trust to an extent if not someone might attempt to disappear after collecting his without fulfilling the same obligation to others. It is a bit risky but sure way to raise money for business in Nigeria, especially if you are fortunate to be the number one or two in the collecting order.

4. Micro Finance Banks: 

Open Account with any micro finance bank or co-operative bank of your choice and start saving a certain amount regularly. Once you’ve saved up to six months, you’ll qualify for a loan of twice your saved amount. One thing I don’t like about micro finance is the fact that you’d have to wait for six months to qualify for a loan and having to pay interest in the loan even though your money have stayed with them for six months with no interest accruing to you.
However, that is the price you’ll have to pay to raise money for your business and many people are finding success using it. So why not give it a trial. Look for any micro finance of your choice and start saving towards raising money for your business. Most of the major banks have their own version of micro finance — you may go with this one for they’re more reliable.

5. Angel Investors: 

If you are not a control freak, if you are ready to give up some percentage of your company’s equity then go for Angel Investors. Angel Investors are business startup incubators and they are not in any particular place — your rich uncle could as well be your Angel Investor. Prepare a bankable business proposal — clearly, state your business plan and objectives. If the Angel finds your proposal appealing, they will invest in it. But, prepare to give up a good part of your company up to 40% in exchange for the needed capital.
If you have any question, drop it below in the comment box

6. Reduce your expenses: 

With little to no real startup capital, you cannot afford to have expenses eating into the little revenues you’re generating. Check every way cash might leave your business and try to completely block it out. The more loopholes you cover, the greater your chances of staying afloat till you acquire considerable investment.

7. Talk to family & friends: 

These are not just the closest people in your life but are the major individuals that can give you some money with only a simple motivational speech.
Family and friends usually don’t require that you show them a business plan because their loan or investment in your startup is motivated by their belief in you and not the idea or skills you possess.

Talk to the closest people in your life. If you understand what makes them tick, push those buttons and you may gain some financial support from their pockets.

Source: https://www.247informative.com/2018/04/6-top-genuine-ways-to-raise-capital-for.html