How to raise money for your business other than venture capital

You may have up with a nice business idea? Great! But now you need a startup capital- this is the initial amount of money to actualize your business idea. And from there, it becomes challenging on how you’ll be able to go about it.

If you’re just starting out, many traditional lenders will not agree or be interested in funding you. But if you are just determined to put your idea into practice, then this should not be problem at all. We have various ways from which you can be able to raise money for your startup business other than the venture capital, they include:

  • Borrowing from your family members- these ones can be able to chip in so as to help you actualize your idea.
  • You can also decide to sell some of your most valuable assets such as TV sets, House Couches, Music system etc.; as long as the money won’t be going to waste, then you’re just justified.
  • You can also maximize out of your own credit card; and lastly,
  • You can ask for loans from your loved ones and friends.

These four ways can enable you get that startup capital for your business idea without necessarily getting funded by investors or getting a loan from traditional lenders. However, one thing you must put in mind is that there will be a lot of risks involved, such as running bankrupt with your own personal finances and also having a sour relationship with some of your friends and family members. Thus, you should be prepared for any eventuality.

Do you have to be based in San Francisco to raise venture capital?

Today, the venture capital investment has gone global and is now spreading to other countries such as India and China, but the most dominant metros still remain the US cities that combine density, big universities, and the great minds and tolerance which is needed to attract talent all over the world. The US is the most dominant country globally in terms of venture capital, and it accounts for nearly over 70%(68.8%) of the world’s total venture capital, followed by Asia in 2nd position roughly at 14.4%, and then Europe in 3rd. place at around 13.5%. When we rank the top 20 metros globally in venture capital, the US still occupies the first top 6 metros and has a total of 12 in the top 20, with San Francisco emerging as the top venture capital city in the US and the whole world at large. San Francisco has an estimated Venture Capital of about $6,471M which is around 15.4% of the share of the Global Venture Capital Investment. In the second place is San Jose which has an estimated venture capital investment of about $4,175 and this represents 9.9% in the share of the Global Venture Capital investment. Both 2 cities are in the US.

We have other cities such as Bangalore, Beijing, Mumbai, and Shanghai which have shown their ability of attracting venture investment and creating startup ecosystem, but their level is way far below that of San Francisco. This cities are still grappling with the inability of being able to attract world’s top talents.

Finally, I would like to say that you really don’t have to be in San Francisco to raise venture capital, but given the opportunity, then this is the best city where one can raise venture capital more easily.

Source:

A report from Martin Prosperity Institute, Rise of the Global Startup City,

https://www.theatlantic.com/technology/archive/2016/01/…venture-capital/429255/