5 Easy ways to raise money for your small business

Raise money for your small business
(Last Updated On: October 14, 2022)

Do you have a great business idea but don’t have the money to start off? Raising funds for your business is not as hard as you think. Here are five easy ways to raise money for your small business:

Do it on your own (Bootstrapping!) 

Because nothing is easier than emptying your own pockets first!

Before going around and asking people to invest in your business, look at your own account. Tap into your savings.

Although it’s risky, it’s your best bet because it shows you are serious about your business and you won’t just run away with someone else’s money. This subconsciously lends a trust factor to your business.

Go on to bootstrap – a fancy word for recycling your money. Every little rupee you make out of your initial investment goes right back into the business until you are comfortably profitable.

Here are a few tips to bootstrap easily:

  • Share office space/work from home.
  • Negotiate with suppliers and service providers to give you discounts.
  • Use your own resources optimally.
  • Hire local – interns and college students.

Remember to save big when you are doing it all on your own.

Related read: Top 5 finance apps for small businesses (free and paid)

Your Immediate Circle

You can request your immediate social circle – your friends, family and colleagues to invest in your business idea. This is an easy way because people close to you are more likely to believe in your vision. However, there is also a high risk of ruining personal relationships.

To avoid confusion, borrow limited amounts of money and ask your friends/colleagues to get legal advice to keep costs to a minimum should things go wrong.

You can also consider crowdfunding your idea. There are several online websites where you can pitch your idea. Investors decide to fund you in exchange for some sort of ownership in the business and expect a chunk of profit when you start making money.

Business Loans

Borrowing loans from banks have become easier today. In the latest budget, Finance Minister Nirmala Sitharaman increased the lending limit to small businesses! This is the best time to avail of loans for your business.

You can approach the government to fund your idea. The government of India has introduced special schemes to finance small businesses.

Some NBFCs (Non-Banking Financial Companies) also support small businesses financially.

Angel Investors & Venture Capitalists

Angel investors and VCs are very similar. Both are interested in investing in your business, both want a share of your business and profits in return.

The only difference is, VCs also want a seat in your office – they want a seat on your board or have some managing rights in your company.


Angel investors need to be registered with the Securities Exchange Commission of India and need to have a net worth of at least INR 2 crore excluding the value of the investor’s principal residence. You can look for Angel Investors at forums like Angellist and MicroVentures.

VCs are usually large companies that are ready to fund you. Here is a list of famous VCs in India.

Incubators, Accelerators and Contests

Startup or small business incubators and accelerators are usually angels or VCs that seek to help a small business grow. Startups are admitted in small batches, 1-3 businesses in a year and are given funding + mentoring to help the business grow.

Incubators and accelerators are involved in every stage of small business growth. However, the focus is on the first few years of growth.

While Accelerators don’t offer office space and other physical amenities to a startup, incubators do.

Contests are another way of securing funding for your business. This includes winning a reality show or a startup event, also probably organized by an angel or VC. Prize money is declared on winning a competition, which can be used as seed funding for your business.


Think your business is not worth taking the risk for? If these stupid businesses can make millions, so can yours!

Bonus Point: If you have a product or service you want to sell but don’t have the money to get a website, don’t worry!

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  4. This is really great work. Just keep writing this kind of post. Keep it up. Thanks for sharing

  5. Great ideas and information. For any business, big or small, the need for working capital is key to sustainable growth. This working capital can be arranged with business loans. An unsecured business loan is a good option for small business.

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