There are many creative ideas on paper or in the brain that are not implemented because of no funding. One of the ways we recommended for funding a business is through family and friends.
This has its pros and cons and in this piece, we have ways on how to raise fund from family and friends to fund your idea.
MAKE IT OFFICIAL
One of the reasons you are not getting the attention of that your wealthy uncle or aunt to fund your business is because you are too related. Even when you say you want them to fund your idea or business, they simply smile away.
Because you have not prepared a business plan and show them. No pitch deck, no official document or legal document that shows you are really ready for business. This usually happens because of closeness or familiarity.
So, if you really want to get the attention of your family and friends to invest in your business, make everything official and well packaged.
BELIEVE IN YOUR IDEA OR BUSINESS
Even if your parents
They will not simply give you their money just because they are your parents or friends but because they see you are crazy about it. Don’t forget, many of our family and friends are business people and they also invest in other businesses. So, showing them that you know what you are doing is a plus over other businesses.
GIVE THEM RETURN ON INVESTMENT
There is a popular saying that business grows when family and friends pay for job done or service rendered. That is a great quote. The same principle is applicable here as well.
Even if your dad is giving you the whole money to start your business, let them have their return on investment and timely. Though they might not ask for this but giving them a return or stake in your business. This gives them confidence in you as a family and as a business person.
Not that this will give them the joy to invest more in your business, it will also open doors for other investors. If investors, ask you are, are your existing investors and you said your elder brother and he has this stake in the business or return on investment, the potential investor will take you seriously.
Suggested Read: 5 simple ways to raise fund for your startup business
BE A CARING ENTREPRENEUR
Entrepreneurs seem not to be caring enough and this has affected their chances of being funded by family and friends. The family you don’t care for will find it difficult to give you their money to do your business.
When you show care to people, them tends to draw closer to you and will be there to help anytime you need them.
So, pick that phone and call your family and friends. Relate and talk about everything and don’t ask them to fund your business yet if this is your first call in 5 months. Do it over and over again before you pitch your idea to them.
Also, be ready to help if their is a need you can provide. Offering your family members some services free will go a long way to have more confidence in you.
Hope this post is helpful.