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7 Ways to Fund Your Small Business

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Feature Image: Angi Welsch for Madewell
Article By: Judy Allen

You’ve done your homework. You know what you want to do and where you want to go. However, fantastic ideas don’t fund themselves. So, unless you’ve got a rich uncle, that‘s willing to pass you some cash, you must figure out how to finance your startup.

First, work with what you have. The Wright brothers, who invented the first successful airplane, funded their grand idea by repairing bicycles. Their bicycle shop can still be visited at Greenfield Village in Dearborn, Michigan. It’s full of crude tools and obsolete bike parts and speaks of working while creating and pursuing a bigger dream.

This method may work for you, too. Ask yourself if it’s possible to keep working while building your startup. You can always taper off the old and put more into the new until you leave permanently. When others are aware of your investment, they may be more willing to give you a hand or a loan.

If you are not in a rush to fund your startup, you can use one of these 20 Creative Side Hustles to Boost Your Income. Use one, a couple, or all of the ideas to save up enough money in a year or less.

So, let’s get started on how you can fund your startup.

1. Talk up Your Idea to Anyone Who Will Listen

When you get ready to launch, throw a party and present your idea in detail, ask for joiners to help get it off the ground. If they can’t support financially, they may know someone who can. Make sure to have business cards to pass around and give extras to those who can distribute them.

2. Crowdfunding

This idea takes place on the internet. You explain your concept, hopefully to a vast number of readers, and interested parties jump on board with a few dollars each. Who knows, some may fork over several hundred or thousands. Be bold and hit every social platform and funding site. 

3. A bank loan

This concept is where your decent credit score will pay off. Tell your banker what you’re up too and listen well. Often, he or she may know of other avenues to get funding in addition to their own. Whether you want to buy a house, a car, or start your own business, it is imperative that you minimize your debt and improve your credit score. 

4. Consider a Credit Card

That may seem frightening at first but think about it. If you’re several thousand away from your limit, have a low to moderate interest rate and can make the payments this may be the best choice for now.

5. Sell Off Extras

If you’ve got big-ticket toys, you no longer us, list them for sale. Things like boats, snowmobiles, jet skis, ATVs and the like can bring in start-up dollars. If you’ve got a timeshare or cabin on the lake, you seldom use, it may be time to cash it out and put that money to work. 

6. Your 401 (k)

New tax laws will let you use your retirement fund without penalty. However, get advice from a business lawyer or your CPA. You’ll want to do this carefully. And remember to pay yourself back when your business gets off the ground.

7. Locate an Angel Donor

Sure, you’ll have to know your stuff to the max but if you know of a possible start outlining. You’ll need to prove your idea is viable and project profits. And anyone that’s going to invest the big bucks will want a clear-cut exit plan—just in case.

Now, back to the beginning. If you’re still working, give yourself time to make the transition. Funding is just one aspect of the overall picture. You’ll better convince yourself of your probable success if you cross over with an incremental approach. Small achievements give the energy to keep forging ahead.

If you’re unemployed, taking out a loan or using a credit card may not be best for you but consider the other options. The more people you can get up close and personal with your idea the better.


In conclusion, don’t carry over baggage from your previous employer. You aren’t building a startup to get back at anyone; so don’t take sour attitudes with you. Clear thinking is needed for every aspect– especially the financials. When you’ve got all the info you need, including market research and state and local laws about opening your own business, you’re ready to find financing. Take it one step at a time and leave no stone unturned.

Perhaps, that guy striking up a conversation at the pump or the gal sitting next to you in the waiting room is an excellent source of knowledge or even backing. Hand over a business card.

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