In Part 1 of this series, Startup business principle 1: Bootstrap with a sense of urgency, I discussed some of the options available to those of you who want to turn your BIG ideas into a full-fleshed small business. Here are two more aspects you might want to take into consideration:
1. Start With Love Money
Most startup business owners face the challenge of finding the initial finance to start their businesses. Some do all sorts of hard work initially to find them because they couldn’t just access finance from their bankers.
Without doubt, cash is as vital a resource to business as oxygen is to the brain. A successful business can die prematurely overnight if it runs out of cash, so does a business idea. I worked in banks for more than 18 years of my career life, and I know that banks are not favorable to lending money to startup businesses.
Banks are in business only to give “good loans” to customers whom they are certain would repay with interest. To obtain a bank loan, you must prove to the bank that you have £2 to back up every £1 you want to borrow. They will require personal guarantees from you; your wife/husband, and anyone else related to you that has the type of assets they could seize if you fail to repay your loan.
Because of this, most successful startup businesses started with what is known today as “love money.” Love money is seed money or capital given to you by family members or friends for the purpose of starting a new business. Love monies are usually lent on qualitative terms of agreement based on the relationship that exists between you and the lender, rather than on a formal risk analysis outcome. Love money can be money from your personal savings or borrowings from friends and family members who are willing to take a chance on you. An angel investor can be a good source of love money and is sometimes the only way a business can start off the ground. This type of business financing allows for gradual and steady growth that would almost be impossible if you were to seek traditional financing options.
2. Consider Alternative Income Streams First
Instead of giving up your idea of starting a business or building a successful business organization for lack of money, you may consider embracing alternative second income stream opportunities such as multi-level marketing or what others call network marketing.
It is surprising how many people ignore the huge opportunities that exist with multi-level marketing business models. To begin with, network marketing offers excellent second income opportunity backed up with vital business development skills and training at very low cost.
As life itself is about selling, network marketing gives you that opportunity of developing the art of marketing and selling, organizing, making presentations, accounting, team building, negotiating, persuading, and communicating. All these skills are more than necessary in building any successful organization. From my personal experience, more than 85 percent of everything you need to start a new business idea or build your own successful business can be learned easily from operating a network marketing business model. This was how many successful entrepreneurs started.
The problem is that your uninformed friends tell you lie about what they did not know about the model, and you believed them without proof. They tell you “it doesn’t work, it is a pyramid, a scam, or a get-rich-quick thing…” But you must always bear in mind, that when you are starting a business, you must be careful whom you share your thoughts with. Be mindful of the type of people you surround yourself with so you don’t get talked out of your vision by chance.
Despite the criticisms about multi-level marketing industry today, there are several successful multi-billion dollar network-marketing organizations that still thrive, helping millions of people to build successful businesses and achieving financial freedom. You too can take advantage of this. You can learn more about this model or contact Rehoboth World, the experts in the world of opportunities.
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Nkem Mpamah is the CEO and Founder of Cognition Global Concepts, a Cambridge-based firm helping organizations and leaders who are struggling to increase productivity and profits, or with leadership teams whose objectives are misaligned from the mission, vision, and values of their companies to improve their performance, increase productivity, and grow profit margins by at least 22% in the first year or less. You can contact Nkem by email at info@cognitionglobal.com or phone 01223 750 250.
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