startup

3 Main Tips You Need to Know to Get Your Startup Off the Ground

For those of you who have never started a business before, it can sound like an intimidating task.Don’t get us wrong – We are not saying that getting your startup company up and running is an easy mission by any stretch.It will take hard work, dedication, money, some sleepless nights, and even some failure  before you succee

I . A BUSINESS PLAN

A proper business plan gives you a significant advantage.So how do you make a business plan?In simple terms, a business plan is the written description of your company’s future.You outline what you want to do and how you’re planning to do it. Typically, these plans outline the first 3 to 5 years of your business strategy. The business plan needs to be the first thing on your list because you’ll use it to help you with some of the remaining steps.

 II. Secure appropriate funding

You’ll need adequate capital to get yourself off the ground.There’s no magic number that applies to all businesses.The startup costs will obviously vary from industry to industry, so your company may require more or less funding depending on the situation.For a small, part-time startup with no equipment, employee salaries, or overhead to worry about, it may only cost you less than $10,000.Other ventures may cost millions. The cost of doing business is much higher than people initially think.Let’s circle back to our business plan for a minute.All business plans contain a financial plan.

This plan usually includes:
  • Balance sheet
  • Sales forecast
  • Profit and loss statement
  • Cash-flow statement

III. How To Get Funding For Startups

You need to learn the best options to get funding for a startup. Not only that, you don’t . Following are some ways to acquire a funding

  • Bank Loans

You can grow your small or large scale company with business loans from any trusted bank. These Business loans come with a host benefits and are tailormade to meet your unique business needs with competitive interest rates. See if you have what it takes to qualify to find the best lender for you. You will need to have a good Credit card history and credit score for the loan and there you are.

  • Angel Investor

Get yourself financed by Angel investors who are often retired entrepreneurs or executives, who may be interested in angel investing for reasons that go beyond pure monetary return. Angel investors can often provide valuable management advice and important contacts.

Because there are no public exchanges listing their securities, private companies meet angel investors in several ways, including referrals from the investors’ trusted sources and other business contacts, at investor conferences and symposia, and at meetings organized by groups of angels where companies pitch directly to investor in face-to-face meetings.

  • Venture-capital investors

It is a private equity which is a form of financing, provided by firms or funds to small to large scale business. Venture Capitalists take the risk of financing risky start-ups in the expectation that some of the firms they support will become successful. You can fund your business with the help of these Venture Capitalists if you have an attractive idea to impress them and urge them to trust you.

  • Equity Share

It is a main source of finance for any company giving investors right to vote, share profits and claim on assets. In the world of financial and investment management, ‘equity share’ is a big word frequently used in every next discussion. We call it stock, ordinary share, or shares, all are one and the same.

There are different types of Equity shares that are classifies based on various things and those are Authorized share capital, Issued share capital, Subscribed share capital and Paid up capital.

  • Join a startup incubator or accelerator

There is small difference between these terms as Incubators start-ups that are new and are at very early stage of their business whereas Accelerators accelerates the growth of an existing idea and business. So all you have to do is choose the right one for your business.

 

finance consultancy

Top 5 Government Loan Schemes for Small Businesses in India

MUDRA Loans

Micro-units Development and Refinance Agency (MUDRA) is an organisation established by the government of India to provide business finance to micro-business units. The loans under the scheme are given on the pretext of ‘funding the unfunded’. Since small companies and startups are often left to their own devices for financing their venture, the government has created the concept of low-cost credit to such under takings. MUDRA Loans are also a refinanced business loans  approved and disbursed through public sector banks, private sector banks, co-operative societies, small banks, scheduled commercial banks and rural banks that come under the scheme. The loans are generally given to micro or small businesses operating in the manufacturing, trading and services sector. -Government loan scheme

The MUDRA Loans  are structured as under,

  • Sishu Loans up to Rs. 50,000/-
  • Kishor Loans up to Rs. 5,00,000/-
  • Tarun Loans up to Rs. 10,00,000/-

Credit Guarantee Fund Scheme for Micro and Small Enterprises

The CGMSE was first launched in the year 2000 as a monetary support scheme for micro and small enterprises. It offers collateral-free credit for both new and existing business units that satisfy its eligibility criteria. The scheme provides working capital loans up to ₹ 10 lakhs without any collateral. However, for all credit facilities above ₹ 10 lakhs and up to ₹ 1 crore only primary security or mortgage of land and building associated with the building is obtained and such eligible accounts are covered under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). Asset created through the credit facility which are associated with the business unit are also considered as security when the loan amount exceeds ₹ 10 lakhs.

The business loans under this scheme are financed by various public and private sector banks covered under the scheme.- government loan scheme

National Small Industries Corporation Subsidy

The NSIC subsidy for small businesses offers two kinds of financial benefits – Raw Material Assistance and Marketing Assistance. Under the raw material assistance scheme of NSIC, both indigenous and imported raw materials are covered. Under the marketing support, funds are given to SMEs for enhancing their competitiveness and the market value of their products and services. The NSIC is mainly focused on funding small and medium enterprises  who wish to improve / grow their manufacturing quality and quantity.

Credit Link Capital Subsidy Scheme for Technology Upgradation

This scheme allows small businesses to upgrade their process by financing technological up gradation. The technological up gradation can be related to numerous processes within the organization, such as manufacturing, marketing, supply chain etc. Through the CLCSS scheme, the government aims to reduce the cost of production of goods and services for small and medium enterprises, thus allowing them to remain price competitive in local and international markets.

The scheme is run by the Ministry of Small-Scale Industries. The CLCSS offers an up-front capital subsidy of 15% for eligible business. However, there is a cap to the maximum amount that can be availed as subsidy under the scheme, which is set at ₹ 15 lakhs. Sole proprietorship, partnership firms, co-operative, private and public limited companies come under the ambit of this business loan scheme.- Government loan schemes