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Almost all companies, whether or not in the fashion sector, have to go through the stage of looking for funding. And it’s normal; you don’t necessarily have to hold funds on you if you wish to start your own fashion startup. We have answered your questions on how to get funding for a startup so you can sit back and start working toward it. Investors can help you in turning your vision into a reality.
Ask Around for Support
The first thing you must do is ask your family and friends for support. The best thing you can do is create a business plan and present it to them. Ask for their opinions and then put forth the question of whether they would be willing to fund your fashion startup. As they know you well, it would be much easier for you to convince them to trust you. Moreover, you can be completely honest with them and let them know about the risks. However, what’s also important is to have a legal contract. You must set boundaries as your startup could be directly influenced by them in the absence of any legal limitations.
Set Up a Crowdfunding Platform
Entrepreneurs wondering how to get funding for a startup can also see crowdfunding platforms as an option. Crowdfunding platforms allow you to raise capital online from, usually, strangers to fund your fashion startup. You may either have a complete donation-based funding option or reward-based funding, which ensures rewards to the donors. Further, you could also announce equity crowdfunding if you’re willing to exchange the donated amount with a percentage of ownership in the startup. Debt crowdfunding is another option that lets you pay back your donors with monthly interest.
Enroll in Accelerator Programs
These programs are short-term that offer a variety of tools for boosting the growth of your startup. You will get the right guidance, informative classes, financial support, and more to achieve your goals. Go for programs pertaining to the fashion industry. It will also help you get in touch with potential investors. Always remember to apply for a lot of these programs as they are quite competitive and may be merit-based.
Look for Angel Investors
Many people know that angel investors sponsor startups, but how to find angel investors? Search engines such as Google and LinkedIn can help you find many equity and angel investors who are ready to invest. Along with this, there are lots of Facebook community groups who are willing to lend support in this regard. You just have to know them, likely by talking to them or researching on them, to determine if they would be ideal for your business.
Angel investors have excellent experience as entrepreneurs and help other start-ups to grow. You must craft your business plan accordingly and present it to them. These investors will require equity but will provide you with a hands-on approach. It is better to find one within your area. However, make sure you have enough information about them before giving them any power.
Reach Out to Businesses & Universities
Reaching out to businesses can help you get good and trusted recommendations. Moreover, you can also get a hold of potential investors. Even if you do not get immediate results, you will get networking resources. Similarly, educational institutions can help you greatly because of their vast alumni networks. Universities with top-ranking fashion programs can help in introducing you to professionals who may be interested in funding your fashion startup.
Attract Venture Capitalists
Another answer to how to get funding for a startup is attracting venture capitalists. When you get venture capital funds, they may either be from an individual or from a group of investors. Usually, these capitalists will look for around 30-50% equity in your business. They will also play an essential role in decision-making. Make sure to prepare an exceptional presentation to attract them. Take online help for finding the right venture capitalist firm.
Attend Fashion Events
One of the most exciting things about the fashion industry is that countless events keep happening regularly. You can make the most of it and attend trade shows, fashion weeks, and conferences. This way, you can get a clear idea about the upcoming trends and make people aware of your potential startup. Similarly, you can also engage with potential investors or people who know investors to fund your startup.
Utilize Online Tools
The world is becoming smaller, thanks to the internet. You can use this to your advantage and utilize online tools. Leverage social media for attracting investors; it’s a free and easy-to-use platform with multiple benefits. Make sure to follow and engage with fashion businesses. Always keep your profile updated as well as professional. Use platforms like LinkedIn, Gmail, and more properly. Send effective emails to prospective investors and market your startup concisely.
Proper funding can greatly benefit your fashion startup. Make sure that before looking up how to get funding for a startup, you have a proper action plan. It is not that tough to get funding, lest you have a risk appetite and a business plan in place. Follow Fashinza for more useful articles to make your fashion brand a success.