No business can survive without funding. That’s why business owners pursue funding opportunities relentlessly before and after launching their companies. Women business owners, in particular, are hyper-focused on financing, mainly because it’s so difficult for them to acquire it.
By JORI HAMILTON
Women entrepreneurs are less likely to get a traditional business loan, and even when they do, it’s far less than what a male business owner would get. But thankfully, conventional business loans aren’t the only funding option for women-owned businesses.
Here are six ways women business owners can secure financing for their new ventures.
Seek Out Angel Investors
If you’re willing to give up ownership equity in your company, working with an angel investor is a great funding option. Angel investors can back your company financially either on a one-time or ongoing basis.
Women-owned businesses can benefit tremendously from the typically close relationship you can develop with an angel investor. They’re more willing to work with you on how you’re going to repay their investment.
Look to find an angel investor that genuinely understands how challenging it is for women to get funding for their businesses in traditional ways. You may be able to find women angel investors too.
Use angel investor websites, networking events, cold-emailing, and other sources to set up meetings with potential matches. When you do land an appointment with a potential angel investor, bring your business plan, be intentional in how you dress, and present with confidence.
If angel investors aren’t working out, a venture capitalist is another funding option for your women-owned business.
Explore Venture Capitalists Interested in Supporting Women-Owned Businesses
Venture capitalists are also willing to financially back businesses in exchange for an equity stake in the company. But you’ll typically be working with big companies rather than individuals if you choose this route.
Having a large corporation financially backing your business isn’t a bad thing. They have unmatched resources and industry connections capable of taking your women-owned business to the next level.
Like angel investors, there are websites dedicated to helping you find a venture capitalist for your business. Also, lean into your professional network to find those known to work with women business owners.
You can also take things into your own hands by acquiring a credit card or line of credit to fund your business.
Acquire a Line of Credit
A loan may not be within reach for women-owned businesses initially, but alternative funding options, like lines of credit, are. Interest rates are higher, and repayment terms are rigid. However, they’re much easier to obtain than most think.
Revolving lines of credit are a fantastic funding option because of their flexibility. They can also help you establish a relationship with a financial institution that can lead to approval for a traditional business loan in the future.
Go to your current financial institution to learn the requirements to be approved for a line of credit, particularly the income and credit score you need. You may have to start with a personal line of credit, but it’s funding nonetheless.
Try grants if you don’t want to take out any debt to fund your women-owned business.
Apply for Women-Centered Grants
You’d be amazed at how many women-centered business grants are out there without any applicants. Nonprofits and other organizations worldwide want to support women-owned businesses with different initiatives and funding resources. They really do.
But many women business owners don’t consider grants because they think a lot of people are applying for them. They also believe that they only have a slight chance at getting the funds and how much work the applications typically are isn’t worth it.
Instead of assuming the applications are too much or that you have a small chance of getting grant funding, do some in-depth research on what’s out there for women-owned businesses. Next, narrow down your search to grants that can help you achieve the level of funding you need.
Then, determine how much time it will take to fill out the applications and set aside time to do so. Submitting a grant application puts you more in the running for funding than you think.
Start a Crowdfunding Campaign
Starting a crowdfunding campaign is another excellent funding option for women-owned businesses. There’s no limit on how much money you can raise, nor are there limitations on who can contribute to your campaign.
Instead of being held back by how you’re going to repay an investment or the biases women business owners often face when getting funding, crowdfunding allows you to leverage the story behind your business as a way to convince people to invest in it.
To set your campaign up for success, choose a crowdfunding platform with a good reputation and one that is easy to use. Then, prepare the details you’re going to share on your page, like your vision, what you want to provide customers, and the impact you want to make in your industry.
When your page is set up, promote it on every digital and traditional marketing channel you’re using. Consistent promotion is the key to your crowdfunding campaign generating the results you’re hoping for.
Attend Networking Events for Women in Business
Networking can help you secure funding for your women-owned business as well. Attending networking events for women in business can help you build relationships with other owners, influencers, potential partners, and investors.
You can learn about funding opportunities through the people you network and build relationships with. You can attend events specific to raising funds for women-owned businesses. You can also get lucky enough to get introduced to potential investors by someone in your professional network.
Look to attend at least one networking event for women in business per month. If you can attend more, great. Social media is an excellent place to start learning about upcoming networking events in your area. Make a list of the ones you’ll absolutely attend and commit to getting there.
The more you assert yourself in your industry and among other women business owners, the better chance you have at securing funding for your business.
There are many options to secure funding for your new women-owned business. They may take some additional work and patience, but they’re out there for you to take advantage of today. Look into some of the options above and get the funding to take your business to the next level.