By Fernando Berrocal

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As a brand-new startup entrepreneur in post-pandemic times, you should be aware that the infrastructure required to start any type of new business is now more accessible than ever. With all of the digital resources offered by the internet (including social media), it's now feasible to take advantage of current technology to outsource labor, connect more quickly from anywhere in the world, and connect with new clients.

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But is there something in the way for you? Your business most certainly needs a financial boost to get off the ground. According to a study by the U.S. Bank, around 82 percent of firms fail because of cash flow issues.  The reason? Newly established businesses are often unable to satisfy the demand their spending generates.

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However, entrepreneurs who want this financial boost have alternatives besides regular business investors. Small business grants and online crowdfunding platforms are only a few important alternative sources of the offers that are available. It's up to you to take advantage of them if you want to get your required money. Every business solution has a unique blend of pros and cons–it's up to you to discover them. The best strategies to launch a business along with their benefits and drawbacks are reviewed below.

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1. Grants from the Small Business Administration

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For businesses that meet the requirements, the Small Business Administration (SBA) offers a wide range of financial options. The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs that provide research grants are among the most significant of these initiatives. The benefits of a grant are that they do not demand a repayment, an SBA grant would effectively be a windfall of money that a business may spend at its discretion to further its goals.

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Even though the prerequisites for these awards can be rather demanding, there are often not many conditions attached to the money once it is awarded. This offers a great deal of freedom to organizations, especially those that are just getting started and need that cash. On the other hand, applying for these funds can be pretty difficult. For your business to be granted such a grant, you must be able to prove that you fall into a classification that is eligible for the STTR or SBIR. Before applying, make sure you have all the required documentation.

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2. Grants for Minorities and Women

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Starting a business is always challenging, but doing so as a woman or a member of a minority group can present a variety of extra difficulties. For many of the benefits, there are a plethora of women and minority grant business programs. These grants may be fantastic chances for firms to enhance their owners' lives, the lives of their families, and the communities in which they live since they essentially have "no strings attached".

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According to business statistics, minorities and women own just approximately 15% and 29%, respectively, of U.S. businesses today. In light of this, the goal of these awards is to further level the playing field between genders and ethics. This has one apparent drawback: not everyone is eligible for these programs. In addition to the fact that many of these funds want to partner with established businesses, there are some additional concerns. As a result, you might have to wait until your business has some momentum before you can apply.

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Platforms for Online Crowdfunding: This kind of crowdfunding source is nowadays widely used, efficient, and pretty simple to use. However, it might not be as obvious a decision as you might first think to decide whether your business should use an online site such as Kickstarter. These crowdfunding sites do provide the benefit of acting as a type of so-called "gift funding", since they allow you to use the money however you see appropriate once your business has established itself and you have received the investment. However, there are some possible disadvantages that you should be aware of, and they are as follows.

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• Providing anything in exchange:  You are effectively selling the concept of your business when you use an internet platform for crowdfunding. Additionally, you could not reach your fundraising objectives if no purchases are made. Consequently, firms must provide labor-intensive incentives for individual investors.

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• These platforms need to be profitable: Therefore, a large portion of your donations will truly benefit the platforms. Although it may not always be an issue, this is something to keep in mind as you budget and prepare for your firm.

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• "Needle in a haystack" Syndrome: The positive is that crowdsourcing is a well-liked tool–the negative news is the popularity of crowdfunding. You'll need to approach the procedure with the same level of planning and diligence as you would when applying for a grant since it requires effort to make your business stand out when seeking a capital injection.

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In retrospect, a cash injection ensures that your business will have what it needs to increase stock, and inventory, or start providing top-notch services. However, one of the most crucial choices that entrepreneurs make at the start is how their firm will raise that cash. Spend some time weighing your alternatives to ensure that your business gets off to a good start.

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Ready to bring your startup to the next level? Apply to MassLight’s next batch. MassLight supplies capital and a dedicated tech team. We take equity in return. Have questions? Refer to our FAQ page.