Getting money to start a business.

NeVeR

Hi,

Myself and a friend are thinking about starting a new business, and we would need a minimum of €35000 to start it, and we where wondering has anyone got any good ideas of raising the money that has worked for you in the past,

We know we could get out personal loans from our banks or bring our business plans to the bank and see if they will lend us the money. But we just wanted to see if you guys/gal's had any ideas. 100#s of heads are better then 1 (or 2)


thanks.

i71jskz5xu42pb

First place to start
http://www.startingabusinessinireland.com/finwhere.htm
and in particular the country enterprise boards
http://www.startingabusinessinireland.com/catgrants.htm

Depending on the idea and its growth/job creation potential http://www.enterprise-ireland.com/ might provide funding

If you have been working you can claim back your tax under the seed capital scheme:
http://www.revenue.ie/doc/it15b.doc
http://www.enterprise-ireland.com/Grow/Finance/Seed_Capital_Scheme.htm

air

Try your local county enterprise board, I've found them very helpful in the past !

fintan

A few things I would recommend

First, get hold of episodes of the "Dragons Den" its a show that was on BBC2, its a real show with a panel of venture captialists and people pitching there business ideas to them looking for investment.

Its really interesting to see what the people who get money do compared to people who dont.

Second thing I would do then is sit down and write a business plan showing exactly what the money is going to be used for and how investors are going to be able to recoup there investment + a hefty return for the risk, or the "exit strategy".

Third thing to do is to pitch it to family and friends for the money.

Best of luck!

NeVeR

thanks for the ideas.. Some goods ones there,

leftofcentre

Welcome to the jungle. Here is the score:

Venture capital guys are only interested in investments over half a million. People willing to invest small amounts, are know as business angles. Essentially they like a gamble. They are tricky to get a hold off, they tend to be local business men. http://www.ivca.ie/bus_angel_finance.html

Banks are a shower of c*nts, you will find them not very helpful. The first rule of business is the bank is satan, never trust the c*unts. The chances of getting a loan of them for a startup are very small, even if they give you one they will make you personally liable for any debt.

Soo.... what i would do if i was you, is just get a personal loan. Tell them you are buying a car, its less hassle.

I would also start small, and only buy what you need. At a general rule, double your expensives figure, and half your expected profit figure.

Trust me, I have had more startups than a set of jump leads.

What the idea anyway? I advise new startups so give me a shout if you like.

Mangler

Yeah I made the mistake of telling the bank the loan was for a business, even though I had a third of the cash to put forward myself they just gave me loads of hassle and after spending a few hours going over stuff, they actually phoned me back with extra hurdles for me to jump, probably in the hope that I would give up on the idea.

RainyDay

Mangler wrote:

Yeah I made the mistake of telling the bank the loan was for a business, even though I had a third of the cash to put forward myself they just gave me loads of hassle and after spending a few hours going over stuff, they actually phoned me back with extra hurdles for me to jump, probably in the hope that I would give up on the idea.

Believe it or not, banks actually want to give out money. That's how they make money. They sell money. If they aren't giving out loans, they aren't making money.

So their extra hurdles are not about you 'giving up' - it's about them having reasonable confidence that they are going to get their money back with interest at the end of the day. Remember they are not caught up with all the emotion & passion which you have vested in the project. They see 100 such requests each week/month and they are pretty good at taking a reasoned view as to the chances of success of any given project.

i71jskz5xu42pb

RainyDay wrote:

Believe it or not, banks actually want to give out money. That's how they make money. They sell money. If they aren't giving out loans, they aren't making money.

So their extra hurdles are not about you 'giving up' - it's about them having reasonable confidence that they are going to get their money back with interest at the end of the day. Remember they are not caught up with all the emotion & passion which you have vested in the project. They see 100 such requests each week/month and they are pretty good at taking a reasoned view as to the chances of success of any given project.

Spot on. OP - any idea which part(s) of the loan checklist you fell down on? There are many models out there that describe what banks look at when giving a loan.

The InterTrade Seedcorn competition might also be an opportunity

NeVeR

cheers guys, more really great info.


sorry Leftofcentre i'm not giving out my idea,,,

raxall

if you do end up going to the bank, act as if you don't really need the loan

if you show you are in NEED and desperate, they'll kick you out.

banks like to lend money to rich people who don't really need it, not those who really need it

boa-constrictor

leftofcentre wrote:

Banks are a shower of c*nts, you will find them not very helpful. The first rule of business is the bank is satan, never trust the c*unts. The chances of getting a loan of them for a startup are very small, even if they give you one they will make you personally liable for any debt.

Of course the bank will seek to make you personally liable for the debt. The banks attitude is that it is your business not theirs. If it succeeds you stand to make (hopefully) alot of money and they get 2% of the debt portion of your seed capital for however long you need it; if it fails you walk away and they take a €35k loss - what kind of a bank would take a gamble like that.

Any bank that gave unsecured loans without seeking personal guarantees would be better off to invest in the relevant business themselves and have the chance of a good profit. Ask yourself, if your not prepared to sign a personal letter of guarantee, do you really believe the business will succeed.

It is true that banks are reluctant to give loans to startups - thats simply because so many of them fail.

I'd advise you to start out small, lease any machinery you need instead of buying it and keep your exposure low in the early days. Debtor collection (if its not a cash business), controlling costs (stock holding, overheads, staffing) and your technical ability will be the keys to success. If the business idea works and you can show even management accounts to back this up, you'll have no problem getting finance to expand.

is_that_so

Agree with some of the postings on banks. My own experience is that if they were running the business it would have folded by now. It can be a pain to get anything out of them. That said my "adviser" does his best.

Venture and seed capital won't come near you as has already been posted.

One area that banks can be good is on leasing, something you should exploit,apart from it being tax deductible.

Personal loans work - saves you having to jump through hoops with a "business plan".

Otherwise you could be reduced to remortgaging (assuming that you have that option).

Govt agencies can be OK but like banks will get you to jump through hoops.

Good luck.

is_that_so

NeVeR wrote:

sorry Leftofcentre i'm not giving out my idea,,,

If it's software it is likely to cost twice as much and take twice as long and it may not even work in the end.

NeVeR

is_that_so wrote:

If it's software it is likely to cost twice as much and take twice as long and it may not even work in the end.

it's not software,, thanks in anyways,

edanto

Have you written your business plan yet? If not, you can get help from the links mentioned above to get that written and also from the business start up centres at the universities (e.g. invent at dcu and nova at ucd).

If it's a really good idea and the plan is solid, then you might have a good chance of winning some money (seriously!) from Intertrade Ireland. They are running a competition to find the best business plans on the island and they have a prize fund of over 200k.

The closing date is about the 30th Sept and all the details are at http://www.intertradeireland.com/seedcorn

the best of luck to ya

quarryman

fintan wrote:

A few things I would recommend

First, get hold of episodes of the "Dragons Den" its a show that was on BBC2, its a real show with a panel of venture captialists and people pitching there business ideas to them looking for investment.

Its really interesting to see what the people who get money do compared to people who dont.

does anyone have any of these on tape? I watched the program when it first came out and thought it was excellent but didn't manage to see all the episodes.

good luck to the OP by the way.

leftofcentre

RE: Dragons Den

The new series is out next month i think, http://www.bbc.co.uk/dragonsden