BSCS
Subject: Entrepreneurship
Semester 5th Lecture #8,9
Date: 10/2/2025 Final Term
Topic: Sources Of Capital To Entrepreneurial
Ventures
Capital Ventures:
Venture capital offers a vital source of funding for startups with high growth
potential, providing capital in exchange for equity. Venture capitalists often bring
valuable expertise and connections, enhancing the business’s strategic direction.
Securing venture capital can be competitive, but it significantly accelerates
business development and expansion.
Most Common Sources Of Capital Ventures
1. Personal Savings
This is one of the entrepreneur financing sources. When starting a new
business, many entrepreneurship funding turn to their personal savings as
the primary funding source.
This method is often preferred because it gives the business owner full
control without the need to borrow money or give up equity to
investors. According to Census Bureau data, approximately 40% of
companies use personal savings as their primary source of startup capital.
2. Friends and Family
Friends and family are another group individuals turn to when seeking
financial support for a new business venture. This type of funding is popular
because it involves people who already know and trust the entrepreneur.
3. Business Loans
Business loans are a common source of funds for entrepreneurs looking to
start or grow their businesses. They are sums of money borrowed from
financial institutions, like banks or credit unions, which must be paid back
with interest over time.
4. Angel Investors
Angel offers financial support to startups and entrepreneurs, often in
exchange for equity in the company. They are typically affluent people who
want to invest in promising businesses at their early stages.
5. Venture Capital
It is essential for entrepreneurs who have a unique business idea but need
funding to bring it to life. It is a type of investment where investors give
money to startup companies that they believe have long-term growth
potential.
6. Crowdfunding
This process is done via online crowdfunding platforms where the
entrepreneur will set up a campaign, outlining their business idea and the
funding goal.
7. Government Grants
Government grants are a form of financial assistance that entrepreneurs
may leverage to start or expand their businesses. These grants are often
awarded to support initiatives in specific industries and regions or to
promote innovation and economic growth.
8. Business Incubators and Accelerators
They help startups to grow by providing resources such as office space,
mentorship, and sometimes even funding. While incubators focus on
nurturing businesses with long-term support, accelerators are more
intensive and aim to speed up a startup’s growth within a few months.
9. Credit Cards
Credit cards are also a common source of funding for entrepreneurs,
especially when starting a small business. They can be easy to use because
many people already have them and are familiar with how they work.
10. Microloans
Microloans are small loans given to entrepreneurs who might not qualify for
traditional bank loans.
11. Bootstrapping
This involves starting and growing a business using limited resources,
typically personal finances, without seeking external funding.
12. Product Pre-Sales
When entrepreneurs are looking to fund their business ventures, they often
turn to pre-sales of their products.
