Finance is a common stumbling block that stalls a good number of ambitious local Entrepreneurs from starting their businesses. Without question Start-Up Capital is a key factor on a long list of requirements that facilitate the start of a success story in business. That is why when Edna Mukurazhizha, the co-founder of WEDB Financial Services discussed money and finance during the first Vessels of Virtue expo in Harare we were quick to sit up and take note. The business woman gave 4 sources of finance relevant to a local Zimbabwean business person. The following are details from the said discussion based on Ms. Mukurazhizha as well as the author’s personal understanding.
An entrepreneur can get m0ney to start a business from his or her own personal savings. If you want to be an entrepreneur in the future, it is important to have a savings account or to have somewhere where one can save his or her money. Some open savings accounts in banks and on mobile banking facilities and others buy property which they will later own sell to get their money back. Do not overspend your money if you want to be an entrepreneur invest the money or open a savings account.
Loans From Friends & Family
Family and friends can be a source of financial loans. Unfortunately most people cannot borrow money from friends and family because of their trustworthiness. How we are perceived by our friends and family affects how they view us as a lendee. Some of are also in the habit of associating with people who do not add value to our lives – this Finance option is a good test to this. One is encouraged to be open to seeking help if possible, don’t let pride keep you from your Entrepreneurial ambitions.
Loans/Equity From Business Partners & Associates
If you are already into business then you are likely to have friends who are into business. You can approach them for loans. One can also avoid the loan and make new partners instead.
“Connect with individuals whose strength is your weakness and form partnerships” said Mukurazhizha.
This advice is for those who are not financially mature for their businesses. If you do not have the money then partner with those who have got the financial capabilities and partner in creating and building a business.
Banks & Financial Institutions / Micro-finance Institutions
“You don’t need money to start a business…..write down your business plan.” – Mukurazhizha
Banks need sound business plans to give a loan. Most are not given loans in banks because they are not writing sound business plans. It is important to get advice from those who are into business to get help in writing good business plans. If you get a loan from a bank or a financial institution make sure that you don’t use the money outside your business. The moment you start using money out of your business you are likely to go broke without accomplishing your business idea. Most have lost a lot of valuable property due to their mismanagement of funds. Discipline is key.
Ultimately, it is not money that is important, it is the Business Plan. As you formulate your business plan you are likely to get better ideas of financial backup.
Good luck !