The biggest problem that many of our clients face is not having enough money to start or grow their business. For anyone that watches Shark Tank, you see someone come up with a great idea, they then start a business or file a patent application and then … the hard work begins. I often say that the idea or invention is the easy part. The patent application (if relevant) is easy for the inventor because the heavy lifting is typically done by a patent attorney. After that, the next steps are manufacturing, distribution, and marketing. None of these steps are easy and they often require a lot of capital.
Savings. When starting up on your own, if you have savings, you may need to use this to fund the beginning stages of your start-up. Remember to put together a business plan so that you know what your expense will be. For the first 3-6 months of your business, you will probably have very few sales while you are getting your name out there. Make sure that you have enough money to cover your business expenses while you are waiting for your first sales. Also, remember to have enough money to cover your own expenses as well.
“Angel” investors. Angel investors are any investors that do not require a cut of your business in order to invest. They are typically your friends and family or other people that are willing to take a chance on you without much in return.
Traditional banks. Assuming your business plan is in order, you may be able to approach a bank for a traditional loan or a line of credit to keep you solvent while you are waiting for your early sales.
Non-traditional options. Crowdfunding can be a great way to get capital. Kickstarter, GoFundMe, Indiegogo, and Patreonare all great examples of sites that allow you to fundraise for your business. In many cases, you will need to offer something in exchange to the donors that fund your campaign. For example, if you need to make product, you may need to promise one of your products to the donors.
IDAs. Local Industrial Development Agencies may be able to offer lending when a traditional bank is unwilling to lend to you.
Please note that this information is shared as guidance only and is not intended to be legal advice for your particular business and circumstances. For more information on IP and to access videos about IP, visit our youtube page.