Principle 13
Using Other People's Money
It's not that I am so smart; it's just that I stay with problems longer.
—Albert Einstein
In this chapter, you will learn five ways to raise seed money to fund your business, three of which involve “Other People's Money,” often referred to as OPM. Entrepreneurs need to look at creative ways to fund and grow their businesses, and here you will learn how, why, and where to look to find these hidden sources of money. You will also read about the cofounders of Google and see how and where they acquired their angel investment to launch Google.
Let's face it, the problem many small business owners have is that they often lack money and are undercapitalized as a result. This problem needs to be dealt with head on. The best way to do so is to understand, study, and know all the options available to you as you grow your business.
Five Types of Seed Money
When things seem grim and the bank has turned you down for a loan, don't sweat it—we have all been there. The reality is that you actually have five choices to investigate when it comes to acquiring seed money to help you grow your business.
1. Your day job or business income
2. Your savings or retirement
3. Your credit cards
4. Angel investors who are friends or family
5. Venture capitalists
Each of these options has its advantages and disadvantages. For example, day job income is money you don't have to pay back, but savings are not something everyone has the luxury of having. Credit cards are ...
