Obtaining Funding for a Business

Believe it or not, there are lots of people with a lot of money who are looking for a good place to invest it. Depending on the culture, wealth, background, and industry of that person, they choose which opportunities are most relevant to them. Someone seeking funds to start a profitable business may have more opportunities than they realize. It takes a good business plan to attract these investors, but doing a little research about who they are could better your chances of getting capital. Here are a few businesses that focus on specific elements when deciding who to fund: 

An organization called First Nations Development Institute “provides both financial and technical resources to tribes and Native nonprofit organizations to support asset-based development efforts that are culturally appropriate.” http://www.firstnations.org/ Their subsidiary is http://www.oweesta.org/. 

Another organization that has a unique mission is the CDFI Coalition. “The CDFI Coalition is the unified national voice of community development financial institutions (CDFIs). (Their) mission is to encourage fair access to financial resources for America's underserved people and communities.” http://www.cdfi.org/

Association for Enterprise Opportunity (AEO) is another place one may receive funding.  “AEO is the national member organization and voice of microbusiness in the United States.” www.microenterpriseworks.org/ A microbusiness (or micro-enterprise) is a small business having five or less employees, seeking startup capital of $35,000 or less. This is the place to look if your business falls into this category.

There are advantages to aquiring money from an investor. You can begin working on your company immediately instead of having to save up money. There is a chance that it may take several years to save up enough money to start the company. Another benefit is avoiding the risk of losing all the money that you’ve saved if your business doesn’t work out as expected. The investors now take that risk in exchange for a percentage of the company. This is the disadvantage. You will always have to give the investor his cut of the money. If he owns 40% of the company, you will always have to give him 40% of the profit. It’s similar with taking out a loan with a bank. The interest that comes with the loan usually ends up doubling the amount you borrowed. So consider the benefits and disadvantages when seeking alternate funding.