Entrepreneurship has never been more fashionable: more and more women are starting businesses on their own initiative. However, financing whether a small project or a huge programme like Horizon Europe is never an easy task. Fortunately, new ways are emerging to find funds and start a project, so knowing the different options will allow entrepreneurs to adopt the way that best suits them according to the needs of their business.

1. Request a loan from the bank

Requesting a loan from a bank is one of the easiest and most used options in the European business ecosystem. In fact, according to the Spanish Confederation of Reciprocal Guarantee Companies ( CESGAR ), 82% of SMEs that needed financing during 2017 turned to banks. Commercial credits, lines of credit, bank loans, all of the products that small and medium-sized companies require to carry out their activity were provided by their respective banks.

2. ‘Business Angels’

The ‘Business Angels’ or private investors are individuals with investment capacity and who have knowledge about the business world, which promote the development of business projects with high growth potential, providing capital and added value to management in its early stages of life. These investors help entrepreneurs with risk levels and lack of liquidity in the initial stages of company formation. 

3. Venture capital funds

Venture capital funds are a financing formula widely used by startups and innovative companies that are undergoing an expansion process that requires investment. These funds are managed by specialized stock companies that invest their financial resources in companies, with the aim of selling their participation in the future and thus obtaining profits. Many of them are formed exclusively by private equity companies, but also by large companies, banks or the Public Administration itself.

4. Accelerators and incubators of startups

This type of institution is in charge of hosting a series of ‘startups’ and accelerating their growth, helping them in their initial stage to configure their business model, their strategy for attracting clients and attracting financing. The accelerators arose as a result of the great interest of the public and private business world in the technological world and are intended to accelerate the development and growth of ‘startups’ in advanced stages, while the incubators support them in their founding moment. 

5. Subsidies and public aid

The Public Administration does not finance business projects directly, but it does make different grants and aid available to entrepreneurs that allow the financing of the business. To access it, it is necessary to meet a series of requirements that may vary depending on the help requested. Most of them are intended for innovation and technological projects that seek internationalization or that belong to a sector that the Administration wants to promote with public funds, such as green companies. The General Directorate for Industry and SMEs offers different aids depending on the activity and scope of the company. Also, it offers different tips for starting a business.

6. Bootstrapping

Bootstrapping refers to the financing of projects through the founders’ own savings and income generated from billing, without depending on external financing such as investments or loans. This formula, popularized as a result of the economic crisis of 2008, requires lowering short-term expectations and investing all efforts in obtaining income and subsequently reverting it to business growth.

7. Crowdfunding campaign

Crowdfunding is a form of collective and collaborative financing, and can become a great asset when it comes to obtaining funds for a project. Thus, crowdfunding consists of putting entrepreneurs who need financing in contact with different investors who want to bet on the company. Normally, these types of processes are carried out online through different platforms in which the project is described, the amount needed, the profit that the investor gets if there is one, etc. The Statista portal foresees that, in 2018, the ‘crowdfunding’ campaigns got 9,370 million dollars (about 7,990 million euros), which represented a growth of 43% compared to the previous year.