I applaud the awesome startups who raise funds and build billion-dollar valuation businesses. Guy Raz writes about some of them in his book “How I Built This“. However, to thank that the ONLY way to get the capital to build a business, is through debt financing or equity financing – traditional startup investment – is a lie.
Indeed, all the “darling” tech companies have massive startup investment funding – WeWork (well no longer a darling), Door Dash, Brook Linen, Loom, Capsule, and so many others.
However, Diana shares that there are two ways to get the funding you need.
First, you could build a company that is very profitable and use those profits to build another and/or a bigger company.
The second way is that you could ask your future customers to pay half upfront.
Instead of getting a loan to buy the “raw materials” upfront, ask your future customers to pay upfront.
Raw materials could be raw goods like plastic, leather, or widgets. OR it could be an engineering team to build an app.
Yes, loans or equity investment is great, for some.
But there’s nothing like building a successful business, which you 100% own and not have to answer to someone else, who might own a large or small piece of your business.
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Source: Smart Hustle
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