Earlier this week on a coaching call, one of our students was struggling to get traffic and sales through her website.
She’s been diligently focused on organic marketing efforts (posting on social media, reaching out to influencers, etc) for the past few weeks.
And that’s worked — to an extent.
Now that her product has been validated organically — as in, she’s able to get sales without ads, she’s ready to start paid advertising to build her audience and generate more sales.
But she felt stuck…
Because, as a start-up, she has limited capital to invest in the success of her business.
In order to be ready for Facebook ads, I advised her that she should have $2–4K to invest in ads before she started seeing results.
[Note: For any new products on the market, there’s a 1–3 month testing period to figure out what works before you will start to see results. Our goal is to have a new product break even on ad spend within the first 4–6 weeks, but sometimes not see profit until 2–4 months into advertising]
For any new store owner, they usually are not mentally (or financially) prepared for paid ads.
The biggest mistake I see new sellers make with new products is spend $200, get no sales, and think ads won’t work for them.
And as someone who’s managed hundreds of thousands of dollars in ad spend, and generated millions of dollars in revenue for new products, I can tell you…
That’s not how it’s supposed to go.
Back to my conversation with Sarah (changed her name for privacy purposes). Sarah so desperately wants to do paid ads, but as of yesterday, didn’t have access to the recommended $2–4K to invest in ads.
So, if Sarah can’t unlock that next level of growth for her e-commerce business without paid ads, she has two choices.
- Continue to focus on organic methods and know it’ll take months before she starts generating the traction she hopes to see, or
- Get creative and find the capital needed to properly start paid ads
And that’s where today’s post was inspired.
Below, I’ve put together a few easily accessible ways to unlock capital for your small business if you’re just starting out.
1. 0% down credit card
Depending on what country you’re doing business in, Google “0% down credit cards in [COUNTRY].
A quick Google search in the US brought up these results for me
2. Loan from your bank
Yes, you might qualify for a small business loan through your banking institution. When I was first getting started with Student Works (my life before LaunchandScale.co), I took out a $6K loan to help me pay for equipment — I was 18. If you need a cosigner, ask your spouse or family member to help.
3. Loan from a friend/family member
If a family member/friend believes in your idea enough, they just might be interested in giving you a small loan (in exchange for equity), or becoming an Angel Investor in your business.
4. Government Grants
Money is everywhere. With the rise of e-commerce and certain industries, there are many small business grants available. Start with a Google search of “Government Grant + [State/Country]”
5. PayPal Credit
PayPal offers a flexible line of credit for purchases. Click here to learn more. We’ve had clients use this to pay us for services and not need to pay the loan back for 6-months.
6. Shopify Credit
This is a fairly new service offered through Shopify, but depending on the amount of revenue your store generates, you might qualify for Shopify Capital. Click here to learn more.
7. Do a beta launch and sell your inventory
If you have done a small inventory run, you can focus on selling your initial inventory run and using the profits to reinvest in advertising.
For example, if you have launched a journal, get 100 printed and spend the next 90-days connecting with your target market, going to markets, and selling your journal.
Need help with this? See my PS below.
8. Start-up Grant Competitions
This is one of my favorite ways to generate capital for your small business. While this isn’t the fastest or easiest way to get capital, constantly pitching at local start-up competitions is an excellent way to build your network, practice pitching to investors, and a way to unlock additional capital and opportunities.
To find local opportunities, google “Start-up grant competition + [CITY/STATE/COUNTRY]” or “Start-up Pitch Competition + [CITY/STATE/COUNTRY]”
Do you have a way that’s worked for you to get financing for your small business? Let me know in the comments!!
Founder of LaunchandScale.co