Raising Money As A Start Up

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On the other hand, you also shouldn’t answer the question by stating, “None”. There are still people who think raising money as a start-up is a mistake and you should only set up a business if you can afford it. But just as raising too much money can have a negative impact on your business, so can raising too little. If you’ve considered skipping the fundraising bit altogether, consider the below drawbacks of raising below the bare minimum. Executing your business plan can be difficult Few businesses are in the position to execute their business plan without any extra funding. You shouldn’t set yourself in a position where a failing business will also mean you lose all of your personal assets as well. The start-up environment is not…show more content…
Not fundraising can hurt your competitive edge Furthermore, while you might like the idea of operating without investment, your competitors are unlikely to share this view. You might be able to guarantee your business is operational by slowly building up the business and its revenue stream. But if your competitor can raise money, and therefore speed up its growth, your business can find making money even more difficult. Not raising money in an environment where other businesses do so can hurt your competitiveness. In the long-term, this could mean that your business doesn’t succeed simply because it refuse to raise any money. Hinder any potential future fundraising You are unlikely to be able to ensure your business can operate without any additional fundraising. Even if you don’t raise money at the start, you might come across a need to raise funds later on. But if you wait until you are desperate for funding, you’ll cause fundraising to become harder. Investors can tell when businesses are desperate and this can cause alarm bells to ring in their head. You definitely don’t want to wait until fundraising is a must-do for business survival. Defining the right amount for your business If raising “too much” and “too little” are problematic answers to the question, the answer must then be “You raise the right amount of money”. But how do you define the ‘right amount’? There is unfortunately no official answer for the right
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