Four Ways To Borrow Money From Venture Capital Financing

According to foreign media reports, the recession is the best time to create new companies. It can hire excellent employees at low prices and rent cheap office space.

This is true, but at the same time, there is a big problem: no investors at all are willing to help you pay wages and office rents in such an economic predicament.

In the economic downturn, it is even impossible for venture capital to raise funds beyond imagination.

Start-up capital is particularly important for startups. As entrepreneurs, the following four ways can help you raise the funds you need: first, borrow money from yourself and finance. In general, successful entrepreneurs have thirty percent of their venture capital from their own savings.

But don't buy the company's equipment with this part of your money, because you need to make sure that you have enough shares of founders.

It's better to borrow money first, and your money can help you get a percentage of your original stock and buy back your lost shares in the future.

Two, to borrow money from relatives and friends, to borrow money from family members and friends has been a long-standing tradition. This is a win-win mode, because the interest rate of borrowing will be 2% to 3% lower than the market general lending rate. For investors, the interest earned will be 1% to 2% higher than the savings interest.

In the current depressed economic environment, banks charge higher interest on loans and pay lower interest on deposits.

OnDeckCapital, for example, OnDeckCapital, is a "online bank" that specializes in lending to small businesses.

The company pays more attention to cash flow rather than credit score and tax returns, replacing the monthly installment through daily deductions.

On the Internet, there is also a new type of financing financial service known as "P2P (person-to-person, personal to individual)" which can borrow money from strangers.

For example, by searching for "person-to-person" to find such a company, issuing your request can achieve the purpose of borrowing.

It is worth noting that the interest rate of such borrowing is often high, but it can help enterprises to obtain funds quickly in the credit crunch environment.

(start up Chinese net remind Entrepreneurs: this way of financing to borrow money, the risk of being deceived is very high.

Remember to be careful!

Four, to finance investors with patience, in the recession, before deciding who to borrow, think twice before leaving those who are eager to receive rewards.

Because in the economic depression period, the output after investment is often difficult to predict.

You can choose to find lenders in business partners, mentors, or familiar suppliers, who will provide a broad repayment period.

The famous entrepreneur SamWalton (WAL-MART founder) raised the first start-up capital through his own social network.