n our world of incredible technologies developed by entrepreneurs we have all become aware of startup businesses that have changed the world with their creative products and services. So the question becomes if you are one of the nearly 600,000 new businesses started in this country each month should you look for venture capital funding like some of the most successful businesses have done? Companies like facebook, twitter, snapchat and others have altered our lives for the better and in each case received some form of venture capital to fuel its incredible growth. So if you are a new startup, you have to ask if venture capital is the holy grail to building a business and in reality for over 99% of businesses venture capital is not ever going to be a real option. An article on Forbes written by a venture capital expert explains that for new startups only 300 out of every 600,000 new businesses receive funding. Since the odds are extremely high that your incredible idea, product or service venture will be in the 99% of businesses that are unable to qualify for VC money, how do you bootstrap the growth of your business?
The first thing that you want to do to prepare to secure any type of startup funding that might come from banks, private lenders and other startup financing options is to build a solid business foundation. Some of the keys to building a solid foundation are found in how your business operates. It all begins by incorporating your business and graduating from a sole proprietorship to some form of corporation such as an LLC, S Corp & C Corp. Thanks to the internet it has never been easier to get incorporated so that you limit your personal liability within your venture. You can simply search on google for the division of corporations for the state in which you wish to incorporate. The majority of states will allow you to register your business online and have it active and incorporated within a matter of days. Obtaining your EIN (Tax ID,) setting up a business bank account and registering a website via GoDaddy are your next steps. Inevitably you are going to need capital for your startup. We live in a capitalistic world that requires capital in order to launch innovative organizations that provide true solutions to the world’s problems.
Startup Funding includes many options beyond VC Capital, begin with the right foundation and Leo Kanell will share startup funding tips and hacks.