7. Self Funding


By far the easiest investor to close…

The only investor you absolutely know will invest in your startup is you. Before you start asking others for money, look at the size of your own savings, the equity in your house, and the limits on your credit cards. For most startups, this is the only source of funding. Which means nearly half a million startups are funded by the owner himself or herself.

If you do expect to raise money from others, you will probably initially launch your company using your own funds. Keep good records of how much you spend to start your startup. Investors will ask how much money you’ve invested, and every dollar you spend on initial expenses is in fact an investment in your company.

No matter what the source of funding for your startup, it is likely going to take longer to reach break-even than you think. It is likely to take far longer than you expect before your company can pay you a salary. Your savings are the source of your personal runway. You need to know the maximum amount of time you can afford to run your startup before you have to give up and get a job to survive.


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