I have completed my business plan in order to pursue my dream. My consultant asked me to propose five ideas on how to generate 1 million as a business capital. So below are my ideas on how I generate my business capital:
FIVE IDEAS ON HOW I GENERATE RM 1 MILLION AS A BUSINESS CAPITAL
- Make a business plan for my musical instrument business. The purpose of a business plan is to provide us with guidance and to help convey the business ideas to investors or lenders. A business plan should provide specific and organized information about company and how we will repay the loan. I applied for a maximum RM500,000 fund which is called Graduate Entrepreneur Fund (TUS2). It is a special fund provided to encourage graduates to venture into business. It is a financing scheme for graduates to start up a business as well as expansion of existing business.
- Use personal savings. Personal savings are the most common source of funds for a new business. This is because most lenders will not finance 100 % of our business, so my first source of capital will probably be a loan from myself. Most lenders require that a reasonable percentage of our own funds be invested in our business, as an indication that we will work hard to make the business a success.
- Borrowing from friends and family. It is a good way for new businesses to get money. It is not uncommon for relatives to make low interest or no interest loans to family members. However, I risk alienating my family if the business falls on hard times and if I have trouble repaying the loan. So I must ensure that I have a written agreement regarding the amount borrowed, the interest rate and how and when the loan is to be repaid.
- Angel investor. It is an individual (my father's friend) who invests in business during its start-up phase who is also a supporter in the early stages of a business. They typically never put more than 1 million into a project and generally like to make investment in business that work in industry they are personally familiar with.
- Business partner. An individual or company who has some degree of involvement with another entity's business dealings. I chose my brother to be my business partner because we have same interest and passion in music.
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