Age is no barrier when it comes to starting your own business or getting funding and help is at hand for 50-plus entrepreneurs from charity The Prince’s Initiative for Mature Enterprise (PRIME), now part of Business in the Community. Nicola Templeton, from PRIME shares her top tips on getting finance.
Do your homework
Before you start spending money on your business idea it’s essential to do your homework: plan your costs and research the market to see if your product or service is needed and whether it solves a problem for your target customers.
Then draft a robust business plan, which will help you approach investors as they will have a clear idea of what they are investing in and whether there is a return of their investment.
Also consider whether you can generate income to fund your business from your first sales rather than seeking business funding.
The Business is Great website has some good resources on how to get started and how to prepare a business plan.
Work from home to save money
Around 70% of new businesses start off in the home and they contribute some £300bn to the economy. The reason for this success is that many businesses are started with little more than using the items you already have at home, so take a look at the equipment you already have before seeking funding for a new laptop or ergonomic office chair.
Your existing laptop will suffice unless you need specific software programmes, you’ll probably already have a phone line, internet connection and a mobile phone so your networks are already in place and using the kitchen or dining room table will serve as a proper desk while you’re getting started.
Bank of family and friends
Approaching family and friends for investment funds is one option as they most likely want to support you but keep in mind that if your venture fails you run the risk of straining close relationships.
Offering up a slice of your equity could be an option but make sure you offer something an investor cannot turn down, thinking about:
- You must excite investors with the chance to make a lot of money
- You must convince them that the risk is low
- You must explain how they will get their profits out
- You must convince them that you will be easy to work with and a great partner.
Government start-up loans
Many small businesses find it difficult to get funding from the banks and in response, the Government introduced the Startup Loans scheme, where people can apply for a business loan of up to £10,000 and access to a mentor. Being a loan, there is some interest to pay back and applicants need to put together a business plan.
To find out how to apply for a loan, click here.
Alternative finance is a way of raising funds away from traditional bank lending. The Alternative Funding Portal is a great website incorporating a traffic light system, guiding you to suitable finance providers.
Remember, don’t just accept the first alternative funder that offers you money. Scope out all your options and make sure you will be able to pay the money back before signing on the dotted line.
“We recommend that even before you approach a funder that you do your homework and know exactly what you are asking for, whether you can demonstrate there’s a profit to be made and whether you can afford to pay funding back," says Nicky.
“Once you have the groundwork laid, you are in a better position to make yourself an attractive proposition and hopefully any funding and support you receive will help unlock your future as a new entrepreneur,” she adds.
- Read more about How to start your own business at 50-plus in Yours magazine out 6th January. Plus interested in running a franchise? Find out more here!