My sister and I started this business, Loose Seeds. We’ve learned a lot so far and wanted to give you some tips in case you are a kid looking to know how to start your own business too.
There is a lot involved in starting a biz, including financing it. Financing means paying for the things like your website, designers, ads, sample products etc.You’ll need to pay for some things you’ll need to start a business AND for things you’ll need to keep it going. You might be trying to start a biz, but without SOME form of financing, you won’t be able to.
So WHERE do you get the money from?
We broke down financing into 4 types. You may use just one of these, or you may choose a combination. Remember, think about the benefit of not just you but the other people involved. Here you go:
- BANKROLL: Get someone, like grandparents or family members, to just give you the money you need, without expecting anything in return.
The benefit for you is that you don’t have to use your own money and don’t have to pay any money back.
The benefit for them is that they can have input into your biz and can pat themselves on the back for playing a part in your start.
- BACKER: Also called an investor, they will give you a lot of money, but you will have to let them have a certain percentage of all the money that you make.The benefit for you is that you will have a lot more money to start so you’ll be able to do a lot more, faster.
The benefit for them is that they’ll get money off of everything you sell possibly forever.
- BORROW: This is like a loan you might get from a bank, meaning that someone gives you money, but you’ll need to give them that amount back, plus more, usually month by month.The benefit for you is that you’ll have a boost in money you need to start and you won’t be tied to paying them back forever like you might with an investor.
The benefit to them is that they get the money back plus interest (a % of money you pay them on top of the money they loan you) in a fairly short amount of time.
- BOOTSTRAP: You’ll have to come up with a plan to make money yourself, without asking anyone for money. So you might use money you got for your birthday or from a holiday gift, any money that you already have. You might also ask can you do some chores to gain money.The benefit to you is that you don’t have to worry about paying anyone else back. It’s all on you!
I hope you choose the one that works the best for you! In case you can’t decide and wanted to know what direction we took, we decided to bootstrap the money ourselves for our business.