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When asked, 3 out of 5 (would-be) entrepreneurs will tell you that raising money to fund their business idea is the reason they have not launched out. I beg to differ. Depending on the type of business you want to embark on, you really do not need millions of naira to start. Consider these:
  • Save money on rent. Go ‘SOHO’- SOHO means Small Office, Home Office ie work from home like Larry Page and Sergey Brin. Alternatively get a shared workspace.
  • Save money on administrative and repetitive tasks by outsourcing. Do you know that you can outsource your HR, Legal, Logistics, Accounting, Marketing (creating content, social media engagement), etc.? This is the 21st century traditional business models have changed.
  • Save money on staffing by hiring multi skilled individuals who can multi task – please pay them what they are worth. You can also engage freelancers (find them in church, social group or even online)
  • Save money on transportation and logistics. Uber, Taxify, ACE and other great services have become the entrepreneur’s best friend. Branded vehicles are so last century.
  • Save money by leveraging technology. There are many online services and apps (some free) that can almost automate many of your processes. If you are retailer you don’t have to own a shop when you can sell online (even using social media)
I am not saying that access to adequate financing is not a challenging factor in entrepreneurship – it is! I should know, I am an entrepreneur myself. What I am saying is that you may not need as much funds as you assume you need.
“The successful entrepreneur runs a lean organisation.” – LizSpire

So when you need money for your business, where can you get it?

In this case, I am referring to money you need to start, grow/expand your business.

Here are five sources you should try:

Your personal savings & assets:

Nobody will invest in you if you have not first invested in yourself. This is what finance professionals call ‘skin in the game’. You are your first source of financing for your business. You must have some savings that you inject into your business. Even if it is just small enough to finance basic expenses. A while ago, an acquaintance approached me to invest in her business. When I was given the schedule of what the funds raised would be used for, I noticed that the first thing on the list was ‘registration of the business’, the next was ‘printing letterheads and call cards’. I walked away from that deal. My reckoning was that if she did not have her skin in the game, chances were I would be left holding the ‘can’ if the business tanks. Most times, you have to sell off a few things (assets) that you own to raise the funds you need for your business. I did that when I started out.

Family, then friends:

No one knows you better than your family and friends. They know your dependability and steadfastness – or lack thereof. They also are intimately knowledgeable of your business track record. They know how many hair-brained schemes you have come up with in the past. If you have family and friends of means, and they are unwilling to take a chance on you, why should strangers take a chance on you? Furthermore, do not ask your family and friends to simply give [dash] you money. You should make it worth their while by accepting their cash as debt (to be paid back) or equity (stake) in your business. When you offer them something in return, they will take you more seriously.


You may wish to identify and approach either of these types of investors:
  1. Angel investors are wealthy individuals who back business ideas early in their generation. They typically invest in exchange for partial ownership of the company, which is a sacrifice worth considering. Your investors in Shark Tank and Dragons Den are Angel investors. Approach them with all sense of seriousness and only after having done all of your homework about your business. Like Robert Greene says in 45 Laws of Power, violate this advice at your peril.
  2. Venture capitalists are similar to Angel Investors, but are usually organizations. They tend to scout businesses that are already in existence in an industry they have keen interest.

Grants and loans:

The government and some philanthropic organizations offer either grants or loans to entrepreneurs to either start up, scale up or expand their business. The main difference between a grant and a loan is repayment. A loan requires you to repay the money you borrow, whereas a grant does not. Some of the organizations that have once* yearly funding exercises include:
  • Africa Enterprise Challenge Fund (Agribusiness Africa Window)
  • Ashden International Awards for Entrepreneurs in Developing Countries
  • AYEEN (Africa’s Young Entrepreneurs) Grants
  • Bank of Industry Youth Entrepreneurship support program
  • BMCE Bank Africa Entrepreneurship Award
  • Small and Medium Enterprises Credit Guarantee Scheme (SMECGS)
  • Diamond Bank Bet Program
  • Entrepreneurs’ Organisation Global Student Entrepreneur Awards (GSEA) for Innovative Student Entrepreneurs
  • FATE Foundation ScaleUp Lab Agribusiness Accelerator Programme (Supported by Africa Capital Alliance)
  • GroFin
  • Innovation Price for Africa
  • Lagos States Entrepreneurs Trust Fund
  • MEST Africa Challenge Scale Up Pitch Competition for African Start-Ups
  • Rekkit Benckiser Annual Global Case Challenge for Social Impact Student
  • She Leads Africa Accelerator
  • Teach A Man to Fish – School Enterprise Challenge
  • The Anizisha Price Grant
  • Tony Elumelu Entrepreneurship Program
  • Postcode Lottery Green Challenge (sustainable entrepreneurship)
  • USAID Accelerating Women Entrepreneurs Prize
*Some of these grants are still open for applications Securing of these does not come easy. You are competing against similarly passionate and tenacious entrepreneurs who see their output as a nation or world scale solution. Therefore, you cannot set out applying casually.

Bank loan:

Many entrepreneurs start here when seeking financing for their business. It is the last on my list because it is my least favorite option for financing. Surprising, considering I worked in financial services for over 10 years, isn’t it? I recall a popular banker joke: ‘A banker is someone who offers you an umbrella when the sky is clear, but takes it away when it starts to rain’. It is not true of all banks; some banks are interested collaborating with you to grow your business. However, the burden rests on you to convince the bank that you have the:
  • Capacity (to pay back),
  • Character (willingness and honesty to use the loan for the purpose intended),
  • Capital (in the form of sufficient assets in your company or skin in the game) and
  • Collateral (security that guarantees repayment or recovery of the debt)
  • In the right Condition (business environment/climate)
Although not mentioned here, other sources of financing available include supplier credit, advance payment from clients or crowd funding.   When seeking to raise money for your business, I strongly recommend you start from number 1 in the list; then work your way down to bank loans. The level of difficulty in accessing financing and the complexity of the relationship increases as you go down the list. In addition, your exposure, the cost to you and your business as well as the risk-involved increases as you go down the list. In addition, I want to reiterate that the competition for the finite pockets of financing is fierce. Do not be naïve to think that no one else is presenting an idea similar to yours. You have to approach your application like Hunger Games – fierce competition! Above all, if you are asking for money to scale up or expand, remember that these formal institutions (fund providers) will be looking at your corporate governance framework; for instance excellent books of account and records, in addition to a proven track record etc. Funding your business with other people’s money demands the highest level of trust and discipline from you. The funds are out there, but do you have what it takes to secure funding for your business?

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This article was first published on 17th September 2018


Liz is a trainer, life strategist, conference speaker and customer service consultant. She is the face behind the LizSpire brand and Chief Executive of Eva Wright. Liz finds mediocrity abhorrent and is driven to bring a full measure of Godly excellence in everything she does no matter how small. One of her consuming passions is helping people identify and develop their latent potential, and giving back to her community. She runs a pet project called “Save Nigeria’s Voice” that collects and routes used books to orphanages and rural schools. A prolific writer, she is the author of ’45 Reasons Not to be Ordinary’ and ‘Contemplations: Echoes of the Deep Vol 1’.

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