Consumers are quickly shifting their preference for the organic market. Items that have been traditionally purchased as non-organic are now hardly considered unless they have a “Certified Organic” insignia fixed on the label.
These products include organic food, grains, dairy products, cosmetics, household items, and many others. One of the many benefits of organic foods is the lack of pesticides and harmful industrial chemicals used during production. This includes such chemicals as Glyphosate (RoundUp).
An increased number of individuals are going organic to mitigate the potential risks associated with chemical toxins. Perhaps, it is high time to launch a new venture in natural and organic skincare products to serve the unmet needs of the health & beauty industry. However, if you have been facing trouble in raising capital for your business, then this article is for you. Just keep in mind, this isn’t actual business advice and only meant to help you chart out a roadmap!
Bootstrap Your Startup
Bootstrapping is establishing and funding your business from the grounds, with nothing in hand, just the personal savings and cash inflows from the first sales. Entrepreneur puts efforts to build a brand name with little or no outside financial help. If you have got a solid and usable plan to set up your business related to organic skin care products, but finding financial difficulties, then consider bootstrapping.
Perhaps you have an idea that operating in home-grown products doesn’t require massive capital. It is feasible to potentially fund your project with bootstrapping. In case you don’t have enough savings to support your organic skincare business, you can consider business credit cards with 0% APR initially.
These types of cards allow you to receive funds for a certain period without incurring borrowing costs. You may be thinking that bootstrapping can be risky on your end as you are investing all of the savings in a single project, then the answer is going to be yes. It is a valid concern.
You can minimize your fear by rationally evaluating your potential. If you have a clear head for your vision and you are relatively sure that your organic skincare business will be able to fully serve the chemical-free skincare needs of consumers, then you should feel confident investing your savings.
Ask Your Friends & Family for Financial Support
In case your savings are insufficient to successfully start an organic skincare business, you can raise capital by getting help from your close friends and family members. According to research conducted in the USA, almost 5% of the country’s adults have financed their money in a startup founded by someone they know on personal grounds.
Hence, it is suggested to pin down a few names from your friends and family who have a sound knowledge of the business community, understand your business plan of launching organic skincare products, have faith in your business, and are willing to take probable risks.
For instance, if you are interested in setting up your business in Indian markets, you can acquire financial support from your acquaintance living in the USA to transfer your dollars so you can successfully fund your business. Nowadays, transferring money to India has been made convenient. You can receive funds in no time via app, online-transfer, and in-person. Once you have demonstrated your passion for your business plan, more people will be willing to fund your idea.
Find an Angel Investor
An angel investor is ready to make investments in potential business startups, typically in give-and-take for ownership equity and convertible debts. Angel investors are always willing to financially support enthusiastic entrepreneurs at the initial periods. When you don’t have sufficient savings and no one from your social circle is ready to make investments, then seek help from angel investors to fund your business idea.
These investors are qualified individuals with an annual income of more than $200,000 and a net worth of more than $1 million. Finding an angel investor can be a reliable capital source for your venture. Other than initial phases, you can team up with potential angel investors even after you have successfully launched your business in the consumer markets. You can expand your existing organic skincare business by pitching great ideas in front of angel investors.
Once you have devised prudent strategies to ramp up the sales volume of your core business products, you can feasibly capture the attention of angel investors by putting up promising arguments and the future potential of your business. At present, numerous resources exist to find prospective angel investors.
Launch a Crowdfunding Campaign
Crowdfunding is a financial strategy to raise funds for a new venture or startup by collecting small amounts of money from more than a few people, typically via online platforms such as Kickstarter.
Crowdfunding is more operational as compared to other traditional fundraising options. It can be an opportunity for your business to pitch its ideas in front of a massive audience at one point in time. By employing a crowdfunding approach, you can attract loyal advocates and early adopters for your organic skincare products. It can conveniently double your media exposure and marketing within a restricted budget.
Crowdfunding doesn’t come without skeptics. However, there have been some very successful companies launched from such platforms. For example, in 2013, a producer of 3D printers, raised capital of approximately $3 million via Kickstarter (a platform of public-benefit Corporation). With crowdfunding, you get the opportunity to interact with like-minded business individuals who can financially support you to achieve your capital goals.
Apply For Conventional Financing Options
Although recent advancements and latest technologies have established new tactics to raise funds, the traditional financing products continue to be the prime options for SMEs. It is stated that around 75% to 80% of the business capital comes from loans, lines of credit, and credit cards. Under traditional SBA loans, there are no hard and fast rules to meet. You can easily apply for a long-term loan at affordable borrowing costs.
If you desire to obtain that funding faster and you have got the unsettled invoices, you can go for the invoice financing option. Before applying for a loan to support your venture, you must work on loan proposals and documents to increase the chances of loan acceptance. You will be asked to show your business plan for organic skincare products, bank statements, the amount of initial funding, and personal information.
The organic market is quickly becoming one of the most in-demand product categories for consumers around the world. In many cases, small organic-based businesses are entering the market with home-made boutique products to capitalize on shortages in supply from larger commercial alternatives.
Starting an organic-based business is much like starting any other. The capital needed to get your business started can make or break you. The avenues of funding in this article are basic outlines of available options for modern businesses. You should always consult with a financial adviser about the best course of action for your business.