Topic: Would you prefer getting a loan for a startup or getting an investor? - page 4. (Read 839 times)

If you have a well thought out business idea but don't have the needed capital to keep it functional, is getting a loan the best option or looking for interested investors?

Would trying to start up the business in your own little way the best option or can you consider bringing a third party into the business who will just serve as a partner that contributes just money?

Running a business definitely requires a lot of capital which one cannot meet with just his own pocket money.  So everyone has to go towards more or less loans. Business loans are an important thing.  However, many types of calculations must be completed while taking this loan. one borrows more than necessary and wastes that money, then he will be in great danger and will not be able to profit from the business. His business will fail

Loans require sudden repayment structure, that's the biggest trouble. If there was an option of "take the loan now, start paying a year later" then I would say that it would be better to keep 100% of your company.

Plus, if we could just take the loan on the companies name, meaning that if we fail to pay then the company bankrupts, then that would be fine too because it would mean that the business did not work, but when we are talking about a new one, you won't get a loan under the business name, you take it personally which means even if the business fails, you still have to pay it. That's why I believe that we are going to end up with loan not being the best option, but to be fair you can't find an investor that easily neither.

Considering these two options that's one of the easiest to get, taking a loan sometimes comes with a whole lot of strict terms and conditions and  with the high interest rate expecially in my region, it's even deficult to put that as an option. Looking at the case with most investors who are just looking for ways to double there already dormant funds, and care little about the owner of the business, it seems to be another problem dealing with them as most of the ratio they intend getting from you seems to be too big expecially when they already know that your proposed business have an higher chance of doing well in the long run.

I know that as a start-up, these sources could potentially help your business to upscale at a very sharp pace and that from the angle of allowing an investor to buy into your business, you could get other added advantage like getting advice and connection that will help boost your business but I'm just curious to ask;

I know that as a start-up, these sources could potentially help your business to upscale at a very sharp pace and that from the angle of allowing an investor to buy into your business, you could get other added advantage like getting advice and connection that will help boost your business but I'm just curious to ask;

 If you have a well thought out business idea but don't have the needed capital to keep it functional, is getting a loan the best option or looking for interested investors?

Would trying to start up the business in your own little way the best option or can you consider bringing a third party into the business who will just serve as a partner that contributes just money?

It has become commonplace for startups to try to get investors early in their development. Because by getting funding from investors, it allows startups to be able to develop their platforms in a more focused manner because usually investors will not only provide funding but also the network and support that startups need to be able to develop in the future. However, there are also startups that are trying to get a loan, but it will be riskier for them because they need to be responsible for their loan and are ready if their business becomes collateral for the loan.

That is definitely the problem with amateur trying to find investors who truly want their project succeed and willing to spend some money into cultivating the project into some extent, when we are talking about money we talking about trust, we all know newbie with no experience of building startup and successfully carrying it into multi millions value always getting ignored, moreover if we trying to find some big investors that willing to spend big money with a lot of uncertainty to cultivate our startup it becomes even more difficult, lets be frank here reputation and alma mater matters a lot in giving that good first impression into people, even more obvious when we trying to find a deal about investment to our startups, they will first judge based on our academic background, if we graduated from ivy league, it instantly gives good impression at the first meeting.
after that they will judge based on our achievement, if we have zero experience quite literally with the startup building, they probably gonna refuse to spend some money investing in our startup.

its always good to start out business from scratch even with loan first, don't set the bar too high, a thriving business that make profit is already good enough, it can work as a portfolio in our end and can elevate the value and self worth in the eyes of other.
what people seem to forget though, investors does manage their risk, they will avoid funding startup if they see no potential, they will judge the product as well based on their experience and sees whether it is fitting to be funded.
but what matter most is whether the business making profit, it reminds me of people that invest in meme coin heavily, they don't care about the idea, they just care to grow their capital and thats it.

I would really be preferring myself to be a sole proprietor rather than on having tons of people who is also an owner of the said company or project but if you are really that in lacking up with some funds
then you wont really be having no choice but to bare up with those things that you dont like. The good thing on being a sole proprietor is that you could really be able to make yourself do the things that you do want
since  you do have that full control or rights then you arent that depending on someone or doesnt really on anything but rather yourself. There are really just that those instances that you are really that eager on trying out to materialize your idea but you dont have any options since you do lack money, you cant take up a loan nor be able to borrow to those people you do know.

-snip-

Nothing beats having your own capital where you alone have total control over the business. But, things don't always go as we desire it. Before going for any option of financing a business, it is very necessary that the entrepreneur reviews the terms and conditions of both options thoroughly before choosing. It is also necessary that whoever has an idea should have at least 50% of the needed capital while others comes from external sources.

For someone who loves to have total control over his/her business, getting an investor might become a problem in the future as personal interests, grudges and bias might set in. I think I fall into this category. It is better I start small with my small capital and a reasonable loan facility I can easily settle with ease than work hard to make profits that will be shared between I and a dormant partner. Those who can do better in partnerships can source for good investors and save themselves the stress of repaying loans and interests.

If you have a well thought out business idea but don't have the needed capital to keep it functional, is getting a loan the best option or looking for interested investors?

When it comes to a startup, it's important to understand that no matter how passionate you personally feel about the project, there's a good chance it will fail to deliver what's expected from it. That makes taking a loan incredibly risky, as there's no guarantee you'll be able to return that money. As for investors, I think it's not a bad idea per se, as long as it's articulated in the contract that you cannot guarantee profit or even return of the invested money. Investment happens at the personal risk of investors. Ideally, I'd be looking for a third option, such as saving up money to give it a shot, or looking for a grant to kick-start the project. When you get a grant, you do usually need to report the results back, but you don't need to return money to anyone. Grantors are not going to profit from the result in any way, so there are no direct expectations in that regard.

 If you have a well thought out business idea but don't have the needed capital to keep it functional, is getting a loan the best option or looking for interested investors?

Would trying to start up the business in your own little way the best option or can you consider bringing a third party into the business who will just serve as a partner that contributes just money?

When you get investors to invest money into your business, they want a share in the day-to-day operations and if they have a controlling percentage of the "shares" they can execute a hostile takeover of your business, when you become succesful or they can sabotage your decisions with their own agendas.

Different people will have different perspectives regarding this based on their understanding and thought processes. I would say it depends on how confident you are about your business idea. If you think that your business idea is great and the chances of it succeeding are way higher than it failing then I would say it is better to take a loan and fund your business with it because even though you might need to pay some interest, you will at least be the only owner of the business when it is all setup and running very well.

When you get an investor for your business on the agreement that they will get a certain percentage of share in the business, it can be a costly deal because once the business starts growing, you will have to give a larger percentage to the partner than you might have to give back as the repayment for the loan.