How To Get Funding For Your Ecommerce Business

Everyone has, at least once in their lifetime, thought about starting a business. People who have lived in the world in which technology was not so widespread have thought of this, and now people living in a world driven by technology are also all thinking about it. This is just the way it is. We all like the idea of being our own bosses and of having a successful company that can provide for us and our families. Yet, even though everyone likes this idea and thinks about it frequently, the truth is that not everybody turns it into reality.

Why is that, though? You would think that the tech developments have made this entire process of starting a business sort of easier and that people will all increasingly start turning towards doing it, but here is the thing. Starting and running a company is still rather difficult and not everyone has the opportunity to go through with it, no matter how much we would all love it. The idea of doing everything online these days has perhaps made the notion of having your own business even more appealing, but that does not mean that it has all become easier.

In fact, starting an ecommerce business is undeniably difficult, and you should get a guide on how to do it if you decide to actually go for it and turn your ideas into reality: https://www.nerdwallet.com/article/small-business/how-to-start-an-ecommerce-business

One of the reasons why people never turn these ideas into reality is because they are afraid. They are afraid of investing in something that is bound to fail and of, thus, losing money without actually gaining anything. This is a completely valid concern and here is what I have to say about it. The possibility of failing is always present, but so is the possibility of succeeding. In different words, if you don’t try it, you’ll never know how it will all turn out, meaning that giving it a go is definitely worth it.

Now, fear is certainly not the only reason why people hesitate to do this, i.e. to start their own e-commerce business. There are those individuals out there who are quite brave and ready to tackle any problems that might come their way in the process of running a company. Don’t get me wrong here, as I’m not talking about reckless people that don’t think about consequences. I am talking about those people who are well aware of the consequences and who still believe that they can succeed if they put enough effort into all of it. The truth is that they are usually right – they can succeed if they put enough effort into all of this.

So, what’s their actual problem? Why are people like those not starting their own businesses and why are they just watching it all from the sidelines, never making a concrete move towards turning their dreams into reality? It’s not because they don’t want to work and it’s not because they don’t want to have so many obligations that come with becoming a business owner. No, there is something entirely different stopping them from taking this crucial step and making their dreams come true.

To put it as straightforwardly as possible, they lack the money to do this. So, they have ideas, they are ready to do everything it takes to successfully run their company, including the stuff listed on this page, and they are willing to put as much effort into it as possible. Yet, they don’t have the money necessary to get things going, which is forcing them to give up on this entire idea. Isn’t that a bit unfair?

Well, we could argue that this is unfair, but the truth is that it’s just the way things work on today’s market. Nevertheless, I have some good news for all those people who are ready to take the dive and who simply lack money to do it, including you. All is not lost! You still have some funding options to consider and your task is to get properly informed about those options and then decide which one could work for you. Of course, if you are not sure which options I am talking about, you should keep on reading, because I will let you know precisely which funding options you can pursue when aiming at starting an ecommerce business.

• Save Up

The first and the most logical option is for you to actually save up for the venture you are trying to undertake. This is also called bootstrapping and the idea is for you to use your own money, as well as the cash flow of the company later on in order to actually build your business and drive it towards success. The good thing about this specific option is the fact that you won’t be in debt if you manage to save up and use your own money to start your company. People usually dream about using this particular solution because it is completely harmless, doesn’t lead you towards getting in debt and you are the only one who bears the risks of failing, meaning that nobody else’s money will be involved and nobody else will risk losing said money.

Even though this specific solution sounds like a dream come true, we have to mention that there are some disadvantages to it. First of all, statistics show that very few businesses manage to succeed by doing this, meaning that the risk of failing is rather huge when you are relying on bootstrapping. Plus, it takes a lot of time to save up enough money, although that depends on the actual ecommerce business you want to start running, and then there is also the risk of losing it all rather quickly, meaning that you can end up completely money-less since you’ve invested everything in a company that has failed. While this option is quite romanticized, given the fact that you can retain 100% ownership and do everything alone, you shouldn’t forget to consider the risks associated with it and then decide if it’s the right move for you or not.

• Borrow From Friends & Family

If you want to be in debt without actually involving any financial institutions into the mix and without worrying about interest rates and similar things that loans can bring about, then you might want to ask your friends and family for support. Of course, very few people will be willing to simply provide you with funding for ecommerce business without offering anything in return, which means that this might not be the wisest solution. There is, however, always the option of offering up equity. In other words, you can sell a share of your company to those people among your friends and family members that want to support you, but this means that you won’t retain 100% ownership over the firm, which is usually something that people don’t like.

• Try Crowdfunding

There is a slightly new concept that can allow people to raise money for the ecommerce business they have in mind and it has proved to be a rather good option for several different industries, including tech startups. In case you could not have guessed it, I am talking about crowdfunding. It could be a good solution for you, but you should get properly acquainted with how it all works before actually deciding to use this option.

Basically, there are websites out there that allow people to financially support the idea that you have planned out and that you want to launch and turn into reality. The good thing about crowdfunding is the fact that you can actually get to test the market before embarking on the actual journey and starting your business, which can tell you a lot about the future success (or failure) of your company. If nobody wants to support the idea that you’re thinking of launching, then there must be a reason for it, meaning that you might want to give it all up before getting yourself in a financial pickle.

• Get A Business Line Of Credit

When you are still in the initial stage of actually building your marketplace and sort of getting people familiar with your business, chances are that you might not really know which types of expenses to expect. In other words, regardless of how comprehensive your business plan is, there is a chance that you won’t be able to predict all the costs and expenses that await you. This is the reason why a lot of people resort to getting a line of credit, which is essentially a hybrid of a credit card and a bank loan. If you believe that this could be the right move for you, make sure to find the right institutions to get the line of credit from. And, whatever you do, don’t forget to find an ecommerce banking platform that will help you keep track of all your finances, since you’ll undeniably need to keep track of everything if you want to succeed.

• Find Some Venture Capital Firms

Another common ecommerce funding option (more here) is the option of finding some venture capital firms. Of course, if you decide to do this, you’ll need to carefully consider which venture capitalists might be right for you. This is because different ones are better for funding different types of businesses.

Yet, if you are committed enough, you’ll be able to find those firms that could easily fund your specific ecommerce business. This is just another funding solution that you might consider, but here is the bottom line. If you are really ready to commit to running an ecommerce company, you will be able to get funded in one way or another, meaning that giving up should not be an option.