Startups in Nigeria are always faced with the task of sourcing for funds to establish their businesses. However, with a good business idea, you can quickly raise funds as a startup in Nigeria.
To some people, the lack of funds is just another excuse for not becoming entrepreneurs.
Undoubtedly, most startups in the country require funds to thrive. There are many ways startups can raise funds as highlighted below.
6 ways to fund your Startup in Nigeria
1. Cooperative Society
Startups in Nigeria are leveraging on cooperative societies to get funds for their businesses. Most often times, the cooperative societies would do a background check on the startup to be sure it is trustworthy.
Funds of this nature come with interest and you pay back as agreed under the terms and condition.
2. Religious Organisations
It is no longer news that Nigeria is one of the most religious countries in the world. Little wonder we have so many churches and mosques spread across the country.
Some of these religious organizations help members who have viable business ideas and need financial support. So, a startup could reach out to some of the religious organizations and their members for funds. But it should be done properly.
3. Bank of Industry
Bank of Industry (BOI) also helps startups who need capital for their businesses. However, BOI requires you to submit a business proposal that will give details of the business you want to embark on and other necessary info about the business.
4. Business Grants
This is another way of raising funds as a startup in Nigeria. Unlike bank loans, business grants don’t need to be repaid. There are various NGOs offering startups access to grants in Nigeria. Some of them are YouWin Connect Nigeria, GroFin Fund, AYEEN Financial Grants, Lagos state entrepreneurs trust fund (LSETF), Tony Elumelu Entrepreneurship Programme (TEEP) among others.
5. Angel Investors
There are lots of entrepreneurs in Nigeria who are willing to give funding for a startup like yours if you are ready to part with some equity.
All you need do is to find these angel investors, send a business proposal about your business, your expectations and what they stand to benefit from the company.
Locating an angel investor is not hard; you could leverage on LinkedIn premium, Twitter and other professional sites to find them. Also, networking, attending business summits and conferences makes it more comfortable connecting with a potential investor.
To approach an investor for funding, you need to have a registered business name, detailed business plan, a winning business proposal and be clear about your terms. It is important to note that while startups maybe desperate for funding, they should protect their ideas from being stolen by getting in touch with a legal practitioner before approaching an angel investor.
6. Online Money Platforms
There are now companies in Nigeria offering soft loans to individuals and startups through their online portals such as Renmoney, Pay later among others.
Your account gets funded within 24 hours once all requirements are met and confirmed. However, the interest charged could be a bit high.