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Which is better build a business on your own or get your friends to invest?

Discussion in 'General Business' started by Hannah Threst, Jun 12, 2019.

  1. #1
    Here's a scenario, you want to build a business but you don't have enough capital to start it on your own. You have friends that can help you in terms of money matters. But the problem is they have no passion or idea on what kind of business you want to build.
    Is it better to just load money to get started or ask for your friends to help you with it. Any suggestions on what's the best option to do this?
    SEMrush
     
    Hannah Threst, Jun 12, 2019 IP
    SEMrush
  2. jrbiz

    jrbiz Illustrious Member

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    #2
    A good way to lose friends is to get them to invest in a business based on friendship alone and then have that business fail. At that point, you will have no business and no friends. And, remember, 80-90% of new businesses fail so it is always a risky investment. I don't know what you mean by "load money" but if you can bootstrap your business on your own, without outside investment, it would be best.
     
    jrbiz, Jun 13, 2019 IP
  3. dcristo

    dcristo Illustrious Member

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    #3
    Do you have a history of building profitable businesses? You know most fail?

    As a "friend" I'm not sure how you could ask friends to invest in your business when you don't even know it will be profitable.

    IMO you should never mix family/friends and business.
     
    dcristo, Jun 13, 2019 IP
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  4. NetStar

    NetStar Notable Member

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    #4
    Here's a dose of reality: Your friends will say they are super supportive of you and your ideas but when it comes to participating or investing you will quickly find out how uninterested they really are. Your friends will not financially support or even physically support your random ideas. They won't even support you when you have an operating business. However, once you become profitable and successful they will all want to support you in a way that benefits them and not you. That's business.... the only person you need to believe in you is yourself. Your friends will probably not be helpful. Build your business yourself. If it's money you lack then you may have to approach your business from a different angle or start much small than you originally anticipated.

    If you happen to have some crazy friends who will throw money at you. Don't accept. Their expectation of return and benefit will never align with a start up business model or your expectations.
     
    NetStar, Jun 15, 2019 IP
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  5. Hannah Threst

    Hannah Threst Peon

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    #5
    I meant "loan" money from the bank.
     
    Hannah Threst, Jun 21, 2019 IP
  6. jrbiz

    jrbiz Illustrious Member

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    #6
    Banks will not loan a new business money unless you have collateral to put up against the loan. And, of course, you will have to pay it back with interest or lose the collateral. If the business fails, you will not only lose the business, but your collateral, as well. Be sure that you are ready for such potential consequences before you take out such a loan.
     
    jrbiz, Jun 21, 2019 IP
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  7. Spoiltdiva

    Spoiltdiva Prominent Member

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    #7
    And of course their credit rating would be shot.
     
    Spoiltdiva, Jun 21, 2019 IP
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  8. Bridget65

    Bridget65 Banned

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    #8
    I think it is better to build a business online on your own. Because you know what your business needs to be grow.
     
    Bridget65, Jun 21, 2019 IP
  9. Hannah Threst

    Hannah Threst Peon

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    #9
    Thank you all for the feedback!
     
    Hannah Threst, Jun 21, 2019 IP
  10. jrbiz

    jrbiz Illustrious Member

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    #10
    Well, at least you got a "thank you" in before being banned. :rolleyes:
     
    jrbiz, Jun 22, 2019 IP
  11. Spoiltdiva

    Spoiltdiva Prominent Member

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    #11
    And as if all this is not enough, she gets banned! Sometimes it just doesn't pay to get out of bed.:(
     
    Spoiltdiva, Jun 22, 2019 IP
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  12. jrbiz

    jrbiz Illustrious Member

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    #12
    Certainly not an auspicious start to her business launch. :eek:
     
    jrbiz, Jun 22, 2019 IP
  13. Tim Werfel

    Tim Werfel Greenhorn

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    #13
    Better on your own!
     
    Tim Werfel, Jun 26, 2019 IP
  14. BizLord

    BizLord Well-Known Member

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    #14
    I have been in business for the last 20 years, and let me tell you: Always start with minimal investment. Do not make the mistake and throw money at an idea that has no proven success yet. You should start at the bottom, the minimal amount of money that can be invested. If you have some success reinvest the profits and start to grow slowly and organically. This way your mind will be at peace and clear, the best state to be in when making business decisions. Wish you all the best of luck. Ah, and your friends...leave em out of it!
     
    BizLord, Jun 26, 2019 IP
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  15. Spoiltdiva

    Spoiltdiva Prominent Member

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    #15
    Very good and sound advice. I would also add that if you don't see some success in a reasonable amount of time, get out. I've seen some that just couldn't admit that they were failing and lost big time.
     
    Spoiltdiva, Jun 26, 2019 IP
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  16. David Michaels

    David Michaels Peon

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    #16
    SHow them some glitter ;)
    I mean tell them that you will say them that you will give them xyz amount of money in particular time. ;)
    In this way they will be attracted in investing with you and some how will get some passion :D
     
    David Michaels, Jul 15, 2019 IP
  17. dojodesign

    dojodesign Active Member

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    #17
    Start VERY small. As small as possible so that you don't get into debt of any kind. Slowly build up from there.
     
    dojodesign, Jul 29, 2019 IP
  18. Stuart Broad

    Stuart Broad Greenhorn

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    #18
    Starting a business by own self is better option then getting help through friends. Specially from those friends who are not interested and passionate may become trouble for you in the future.There are so many people who started by own self and work hard and achieve there dreams. Read their stories I think you do not need money you need inspiration.
     
    Stuart Broad, Jul 29, 2019 IP
  19. AlphaNine_Vini

    AlphaNine_Vini Active Member

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    #19
    I would recommend don't limit your opportunities within your friend circle. Make new friends and try to do join venture. Do some friendly event with upcoming entrepreneurs who are ready to invest with you.

    After a initial start and looking at growth. You can take your idea to a established organisation for a merger. This will provide you good number of resources to expand your ideas in reality. Founder will be the owner, that is not important.
     
    AlphaNine_Vini, Jul 30, 2019 IP
  20. GabyModa

    GabyModa Peon

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    #20
    Well, there is no rule in that case. Depends what is your relation with your friends. Sometimes is better to cooperate in business, because the more the merrier. Many opinions give birth to the right choice, but when many hands count the money, mistakes comes out. On the other hand if you are on your own is much harder but you count only to yourself. There is an old saying "The neck of the lone wolf is thick".
     
    GabyModa, Jul 31, 2019 IP