Sometimes an idea really is just that good, and you simply will not be able to sleep through another night without being able to see it through to its full potential. However, bringing inventions to life can cost money, you have design costs, finance costs, you may have to hire people to fulfill certain costs, you may have to travel, meet with people, entertain: there is just so much that is needed to bring an invention from an idea into a reality , that funding is a necessity. So how do you get it? Here are some options available to you:
1.) Bank loan
If you have a good credit rating and you think that your bank will respond favorably to you, then one option to get funding is to visit your local bank and ask for a business loan. The pros of this are that you can fund your invention, whilst starting up a business account that will eventually become the account with which you monetize your idea. The down side is that business loans come with costs, repayments and charges and so if your idea doesn’t perform as well as you hope it would, you will have repayments to deal with that you may not be able to afford, and may even be secured against your home.
If your idea is relevant to a particular area such as health, or food, then there may be a corporation out there who would be willing to sponsor you. The benefit of this is that there will be nothing to pay back, and you also get the added benefit of having a big business name supporting you. On the downside, you will have to share your idea, and if it really is as good as you think it is, they can steal it from you!
3.) Crowd funding
Crowd funding is a relatively new way of gaining funds. Crowd funding is basically an online community of people from all over the world who are willing to contribute to projects and business ideas, in return for a share of the idea or business. This all happens online, and the pros are that you can generate some quick cash quite fast. On the downside, you will have to share out your business with strangers, and so you won’t completely own whatever it is that you end up with once you have secured the investment.
4.) Angel Investor
An angel investor is a rich person who makes a hobby of investing in business ideas that they think are worthy (think Dragon’s Den and you will get the drift)! Angel investors are usually quite strict on the conditions in which they invest and they also will require some share of your business and so before accepting any terms, be sure you know what you are getting into and don’t allow yourself to be bullied just because you think you have a winning idea!
5.) Personal finance
Of course the best way to fund anything at all is in the form of personal finance, which can be taken either from savings, selling assets or remortgaging your home. Of course, the downside is that you stand the risk of wasting your money, but at least you won’t owe anyone anything, and if in the end your invention does turn into a successful business: it will be well worth it!
About the author: Ben works for TheDesignVillage.co.uk, a product design company based in Guernsey.