As the business develops and the number of transactions increases, there is a need to invest more and more funds to the business enterprise was able to cope with the increasing demand. To find additional sources of funding, entrepreneurs cannot afford to lose control of their business by directing them to third-party investors. And then begin the search for other alternatives. Among the quite popular in recent years, strategies for successful business without investment from the outside can be identified crowdfunding (crowdfunding) and bootstrapping (bootstrapping).
Crowdfunding is the financing of the project by a large number of individuals.currently, crowdfunding is one of the most frequently used models of business financing, which emerged relatively recently. There are a considerable number of successful business projects, the collection of funds for the implementation of which was carried out on a voluntary basis by everyone. At the same time, for the transfer of funds, financial donors necessarily receive something in return, for example, discounts on some types of goods or services of this enterprise.
It is noteworthy that crowdfunding allows you to keep up with several hares at the same time; to find the necessary funds for the development of a business project, to test the popularity of goods or services among consumers and check their willingness to pay for them, to create a group of brand ambassadors, or in other words brand ambassadors, who not only strongly support the idea and the associated development campaign, but also carry information about the business project to the masses.
Bootstrapping (literal belt-tightening) involves small business with very little external financing, mainly through borrowing from banks, using their own savings, loans from relatives or friends. But do not lose sight of the fact that getting a loan from a Bank can take a lot of time and nerves. That is why many entrepreneurs prefer to rely only on their own finances or seek help from relatives and friends. Bootstrapping is characterized by a great dependence on internal sources of financing, credit cards, mortgages, loans.
So, as we can see, there is always an opportunity to find additional sources of funding and maintain full control over the entire business and the state of its financial Affairs.