The key is matching the amount of capital and how you raise it to the nature of the business, strategy, potential, and business objectives.

1. Capital intensive or not

Some businesses need almost no capital. For example, management consulting, graphic arts, bookkeeping, just to name a few. Others need enormous capital: steel manufacture, autos, and many others.

2. Business potential and aspirations

Furthermore, the level of capital for each business is a matter of a mix of potential, objective, ambitions, the nature of the business coupled with the size of the market and potential for growth and potential for investment. there's different potential, and strategies, between different businesses. Some are critical mass businesses that can be huge but have to grow big or won't succeed at all. Some are easier to grow organically. For some, the opportunity is so big that it's a good one to share with investors, keeping less ownership, because the investment can pay back well. For others, it's a great potential business for owner operators, but not for investors.

3. Who and where

And beyond that, what's realistically available depends not just on the nature of the business, its aspirations, but also on who the founders are and where the business is located.

Funding is easier to get in some markets than in others, and different in some markets. Angel investment, for example, is easier in developed countries than in developing countries. Foundation money and NGO money is more important in Africa and Latin America than in the U.S. Funding strategy needs to recognize those differences. The founder in Africa has a lot tougher go than the founder in the U.S., U.K, etc.

Outside investment is much easier to get when founders have already done startups than when it's their first time through. Credible founders have a much easier path to outside investment.

Friends and family investment is much more available to those who have friends and family with means than those who don't.

Bank loans are available to people who have assets to pledge, and not to people who don't.

Therefore:

As I said in my first sentence, the best way to find financial capital when starting a business is the way that matches the business, its potential, and its founders.

mastermold

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