Seed Funding, Get it From the Right People

Starting a business is always a risky venture. It can be one of the most rewarding and satisfying things you can do if it goes right and it could be the worst mistake you make if it doesn’t work. There are so many things that go into starting a business or becoming an entrepreneur. You have an idea. Great. Then you make a plan. Outstanding. The next step is to find funding. Silence. Funding is the most important step when starting your business and if you do it wrong or get funding from the wrong people you could find yourself upside down before you ever have a chance to get your business feet under you.

Seed funding is the funding used to start your business or development and it is typically either put up by the owners or a company/person that wants a vested interest in the business. This is the most important funding your business will need. This is the money you need to show your business is going to be able to walk on its own. Most investors or lenders want to see a business or idea that has research behind it or a plan that will most likely be successful. Seed funding is an “at risk” investment and is often used to create research data to show other investors that you actually have something that will make money.

The most important aspect about getting seed funding is possibly WHO you get it from. You want to make sure that you are getting any funding from predatory lenders or investors that are looking to take over your business. People get funding from the wrong people all the time and it almost never ends in their favor. You want to do your research when looking at a funder. Make sure that they are legitimate and aren’t trying to pull one over on you.

When you are receiving funding from someone or a funding entity you want to make sure you look at their funding profile. This will show where they pull their funding from and how it is used. This can show you the risk of working with a funder. Diversification in a funding profile is an important element in risk management when receiving funding.

There are many different ways to receive seed funding for your business plan or development idea and it is going to require diligent research and information gathering. It’s never good to just jump at the first investor that comes your way. Make sure you are checking up on everything you can. Seed funding can be the most important step towards your idea. Starting a business or development is risky and not every venture is a successful one. Increase your odds by doing your research. The more you learn, the more likely you are to succeed.