News: Fundraising to Start an Online Business
You can raise funds to start an online business from home. In recent years, office workers who have no idea about fundraising have found it easier to raise money.
In terms of ways to raise funds, there are not only loans from banks, but some people have also been able to raise funds to start a business through methods such as crowdfunding.
Calculate how much it will cost you to start a online business
Once your business model has been developed, you will need to raise the funds needed to start the business. Starting a business requires capital, but thanks to the new Companies Act that went into effect in 2007, you can start a business with capital.
However, if the capital is set at 1 yen, there can be various consequences once the company is established, such as "inability to open an account", "inability to increase the capital" and "low social credibility". This suggests the need to choose the right financing method.
According to the Japan Finance Corporation's Real World Review of New Businesses, the self-financing portion of start-up loans averages about 30 percent. Before you rush to raise funds, think carefully about how much you need. Startup Capital - Equity = Amount to be covered by loans, etc.
Example of funds before starting a business
Given the formula above, you can calculate how much of your own funds will not be enough, that is, how much you will have to finance yourself. If you underestimate the amount you need to get a loan, you will run out of funds once you start your business and you won't be able to stand on your own.
Relationships between the business and the store: deposit, key money, brokerage fees, redevelopment fees, signage fees, etc. Equipment costs: desks, chairs, computers, printers, phones, cars, cash registers, shelving, kitchen equipment, etc.
Total amount of funds after opening business
If you can estimate the total amount of funds after opening, write that amount down as opening funds for a few months after opening. The number of months you are willing to spend depends on your business sector and your business strategy, but it's safe to say three months or more.
Steady turnover doesn't always increase right after you start your business. If you don't have enough resources, you can't focus on management. We recommend that you make a strict budget for the funds you need so that you can get your business off to a good start.
Saving your own money while running an online business
Self-funding is money you can use for your business from your own savings. If you can start a business with your own money, you won't have to pay monthly fees or interest, allowing you to start your business at a low cost. However, in general, credit checks after 3 months of starting a business are more stringent than credit checks at the time you start your business.
This is because the real value may not be requested and assessed until three months after you start the business. If you start with your own funds, there is a risk that the loan application will be rejected because of deteriorating cash flow after you start the business.
When you start a business, you need to raise funds in addition to your own money to be able to start your business in enough time. The ratio of self-funding to funds at the start of the business is called the "self-funding ratio."
Since management is not always immediate, it is also advisable to set aside, in addition to the initial funds, the funds needed to start the business for six months or more. Especially for those who want to open a store, the following rule applies: save your own funds so that your equity ratio is equal to or greater than 34%.