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11 ways to fund your business

11 ways to fund your business


Country Manager Denmark

As a young entrepreneur , it's not always easy to make ends meet, especially when it comes to financing a new business.

Where can you find the money you need? We'll help you find out in this article.

How much money do you need?

When considering financing your business, it's an excellent opportunity to think more carefully about your company's budget.

  • How much should go to salaries?
  • Software?
  • Office?
  • Marketing?
  • Do you need physical goods in stock?

Find out the minimum amount you'll need to spend each month on costs. Then you can add the amount you want to earn each month.

Once you have that in place, consider one or more of the following financing options.

1. Own savings

Your own savings are the best place to start if you need money for your startup. It's actually really hard to find funding elsewhere if you're not willing to put money into your business yourself.

It's important to show that you're willing to take some of the risk yourself.

Another advantage of financing your business yourself is that you can get started right away. You do not have to spend time pitching your idea, neither to family, investors or loan providers.

You can often get quite far with even modest amounts, depending on the type of business you want to start.

There are several business models that do not require a large initial amount. Here are some examples:

  • Online service. If you sell a service marketing or similar, you are largely selling your time. It does not require the large initial costs.
  • If you have existing skills, as a consultant you can work from home.
  • Whether it's text, graphic design, video or something completely different, it doesn't cost much to get started.


  • You can get started quickly.
  • You have more control over the business.
  • You don't have to spend time talking to investors and loan providers.
  • The pressure on you is less, since you don't have to pay money back to anyone.


  • You take all the risk yourself.
  • There may be less money available, depending on your savings.

2. Investors

The classic way to finance your business is to find an investor. An investor is, as the name indicates, a person or company that invests money in your business.

In exchange for the investment, investors gain control of part of the company and part of the profits.

There are several types of investors.

  • Angel Investor. An Angel Investor is a single influential person who invests in a business (usually a startup). A company may well receive investments from several Business Angels.
  • Venture capital or investment fund. Venture capital differs from business angels in that it is a pool of capital from a number of different individuals and/or companies.

There are also other forms of investment, such as the investment industry. Crowdfunding, which we'll talk more about later in this article.

What does it take to find an investor?

In principle, there are no fixed requirements you have to meet to find an investor. Most require you to be able to present a detailed business plan.

No investor is required to invest in your business.

In order to improve your chances, you must be able to explain to investors why it is a good idea to invest in your particular business.


  • A good initial investment gives you the means to grow your business
  • If you find a good investor, you can benefit from their experience and network.
  • You don't have to finance the entire company yourself.


  • It takes time. Preparing a business plan, practicing a pitch and finding the right investors is work in itself.
  • You must give up the portion of profits that will go to investors.
  • You lose some control, and you may not always agree with investors.

3. Business loans

It's probably no surprise to you that business loans are a financing option. Qred's core service is precisely business loans.

A business loan is a loan for business purposes. It can therefore only be taken up by companies, not by private individuals.

Qred is one of the only providers to offer business loans for start-ups. If you have a good idea, we are willing to lend you money, even if the idea has not been implemented yet.

Of course, a credit assessment is prepared for you and your company, and you are also personally liable. If you want to take out a business loan, you can apply on the front page.

You can also see an overview of Danish business loans at Financer.com.


  • It is possible to get financing even if your business is brand new.
  • It is non-binding to apply.


  • You must still be personally liable for the loan.
  • If your business fails, you will have to repay the loan yourself.

4. Borrowing family and friends

Do you not have enough money and can you not get a business or bank loan?

Then it is a lot easier to persuade friends and family to give grants than it is to pitch your idea to a number of investors.

Obviously, borrowing money from family or friends is not without risks.

Should your business fail and it becomes difficult for you to pay back the money, your personal relationships may suffer.

What you need to have in place

  • Written agreement. Even if they are friends or family, it is a good idea to have a professional approach. If necessary, present a business plan.
  • Avoid misunderstandings. Explain how the funds will be used and remember to tell them about the risk they run by lending you money. It's important to make informed decisions, no matter who your investor base consists of.


  • You can often get an advantageous interest rate when you know your loan provider personally.
  • It's easier to pitch your idea to friends and family than unknown investors.


  • Risk of personal relationships suffering if the company fails.

5. Crowdfunding

Raise capital for your business online through platforms like Kickstarter or Danish Boomerang.

Crowdfunding is when you as a company or private individual raise capital from many different people. The aforementioned platforms, and many others, match projects and investors.

One of the advantages of crowdfunding is that you can test your idea on a smaller scale. If people support your project, it's a validation of your idea.

However, if you do not get any support, it does not necessarily mean that the idea is not good. When it comes to crowdfunding, there is a tendency to support new ideas rather than existing ones.


  • You're not only raising money, you're also getting out with your message.
  • It's relatively easy to get started.
  • You can use crowdfunding to test the market and validate your offer.
  • You gather all investors in one place.
  • You should not hand over part of the business to investors, as is the case with Venture Capital or Business Angels.


  • It takes a great deal of work.
  • If you fail, it's a public defeat.
  • You still need to pitch your idea to investors.
  • It often requires an original idea, as many try to get their projects crowdfound.

6. Crowd loans for business

Have you heard of crowdlending before? So where investors and borrowers are matched in a win-win solution? It also exists in a business context.

It works in the same way as crowdfunding, but instead of an investment, it is a loan. The money must therefore be paid back to investors again with interest.

For you as a borrower, there is not much difference from crowd loans to ordinary business loans. In some cases, it may be easier to get approved, but the terms are about the same and you have to go through a credit assessment as usual.

Read more about creditworthiness for companies.


  • You can validate your idea to some extent depending on whether people will lend you money or not.
  • It is non-binding to apply.


  • You run the same risk as the borrower as with ordinary business or bank loans.
  • If your business fails, you will have to repay the loan yourself.

7. Bootstrapping

Bootstrapping means that you finance your business yourself. Bootstrapping is a combination of several different funding methods.

For example, you can benefit from your own savings, credit cards or by selling off your belongings. This ultimately means that you are financing your business yourself, not an investor or lender.

It's almost always a good idea to put money into your business yourself. If you're spending other people's money, it's easier not to be careful with your budget.

If, on the other hand, you use your own money, you will to a greater extent ensure that the money is spent efficiently.


  • Full control over the company.
  • Getting started is quick and easy.
  • Even if you start out with bootstrapping, you can still get external help later.


  • If things go wrong, you lose your own money.

8. Save and earn more money

If you can save money in your everyday life, you can spend it in your business. The same is true if you can earn more.

As mentioned, not all business types require large start-up capital, but if yours does, you can go a long way by optimizing your everyday budget.

It can be extremely lucrative to make it a habit to save and reinvest the profits in your business.

Save by

  • Cut down on subscriptions and services.
  • Avoid impulse purchases.
  • Restructure your loans to cheaper loans.
  • Set a budget.

Earn by

  • Sell off your belongings.
  • Rent out a room in your apartment.
  • Take on an extra job.


  • You are not dependent on investors or loans.
  • It is relatively easy to save and earn more money.
  • You remain in control of your business.


  • It takes time that you could have spent on your business.

9. Scholarships

Scholarships are great because they are free. They differ from investments and loans in that you do not have to relinquish ownership or pay back the money.

There are grants for many different purposes, in many different niches and of all different sizes. Both private companies and the state issue grants. So does the European Union.

There are actually about 15,000 different foundations in Denmark, many of which grant grants to entrepreneurs.

Read this article on Fundraising.dk, which lists a number of different grants for entrepreneurs.


  • It is free to apply for a scholarship.
  • All the money can be spent on the growth of the company.


  • It takes time to research and tailor applications.

10. Home equity loans

If you are a homeowner and your home has increased in value, you can take out a home equity loan.

It can be a significant amount of money that, in theory, you can spend as you please. You could appropriately shoot them in your business.

Home equity loans differ from bank loans and business loans in that they are secured loans.


  • You have security in your home.
  • It is one of the cheapest possible loans.
  • You are in control of the money.
  • You can spend the money as you like.


  • It is still a loan that has to be repaid.

11. Bank loans

One of the most obvious solutions for financing is to go to the bank and ask for a loan. A bank loan can have different purposes, and often it can be a synonym for a regular consumer loan.

You can use these loans as you like, and thus also for your business.

One of the snags of bank loans is that they are often relatively expensive. You are also personally liable for the loan, since it is you, as a person, not your company, that takes out the loan.

This means a regular credit rating and possibly a talk with your bank advisor before you can get the money.


  • You remain in control.
  • You can get the money relatively quickly.


  • You are personally liable for the loan.
  • The loan can get expensive.

Don't be blind to one type of funding

The good thing about having your own business is that you decide what happens. You can easily start out by using your own savings and at a later date take out a loan or find an investor.

There are many advantages to spending your own money on your business. This creates a certain amount of pressure that can help increase your productivity.

At the same time, it requires you to be more creative with how you spend the money you have available.

If you spend your own money first, you can get the right systems in place that work efficiently for you. Those systems can build on top with other people's money later.

Have you already reached that point?

Then you can consider a business loan from Qred. It can give you the extra cash flow you need to take your business to the next level.

Qred has flexible conditions and attaches great importance to customer service so that they can help you in the best possible way.

Still not convinced? Then you can read this external Financer.com review of Qred.

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