Required Startup Funds
Startups require funds for ensuring effective operations within organizations exploring new investment opportunities. A full-service beauty salon is a strategic venture in modern economies, as noted under the primary market. As a result, it is important to identify and evaluate the suitability of alternatives available for sourcing working capital (Peek, 1). Tactical allocation of financial resources is critical to the efficient management of startups (Berry, 2). Obtaining startup funds and working capital for a full-service beauty salon should ensure reliability and dependability for production activities consistency.
Strategy for Obtaining Startup Funds
Self and crowd-source funding are strategic channels of obtaining the required financial resources for the beauty salon. The former process is also called bootstrapping, and it implies using personal savings and borrowings from close relatives and family friends (Berry, 2). For instance, self-funding would be useful in purchasing vital equipment required for a full-beauty salon’s basic operations. In addition, this strategy also includes crowd-funding as a useful channel of obtaining working capital (Peek, 1). Many activities in the business require recurring expenses such as electricity and wages. Hence, this funding source would be useful for growing the business.
Rejected Sources of Funding
I have rejected funding sources from venture capitalists and Angel investors for varying reasons. The former channel of acquiring working capital has strict monitoring as potential growth should fulfill shareholder expectations for sustained funding. In essence, requirements outlined for securing finances from stockholders limit productivity as businesspersons begin pursuing other objectives (Peek, 1). Another funding source I rejected for the full-service beauty salon startup includes the Angel investment. It was difficult to convince individuals with surplus finances to put their business trust in a startup business (Berry, 2). These investors require a fully running business entity whose profitability is ascertained.
Sources
Peek Sean. 2020. Small Business Financing Options That Bypass Traditional Banks.
Berry Tim. 2020. How to Get Funding for a Business.