3 Ways To Get Capital For a Small Business

During my pregnancy and after the birth of my first born child, I lost sleep over a lot of things. Having just graduated from college and holding down a 9 to 5 job that didn’t pay too much, the biggest pain point was how to manage the bills that came with having a baby. My salary would take a hit from all the additional costs of baby clothes, food, diapers, hospital bills, and a nanny. Being the bread-winner, I was desperate to find a means to make extra cash to sustain my family’s needs from the comfort of my home.

So I started my first side hustle: designing handmade crafts. The thought of making an extra income with a skill I have while still bonding with my newborn gave me all the motivation I needed. Honestly, there’s no blueprint for entrepreneurship, but these 3 hacks will help you get capital to grow a small business:

   1.An Online Shop

Confident in my eye for design, I started off by making ‘quick sales’ from designing refurbished home decor. I used low-cost materials like recycled wine bottles and Ankara fabric pieces spending an average of Ksh. 2,500 – all in the comfort of my home. When I set up my Facebook and Instagram pages to showcase my products, I boosted the product posts that usually have a high demand to target online shoppers using just Ksh. 1,000.

Friends with experience advised on using Facebook and Instagram as marketing tools since they are affordable and very easy to use. They also help with targeting potential customers based on their interests which increases your chances of selling. This way, I got to generate more profit which I channeled back to invest in making more craft supplies.

   2.Family/Friends

As my business grew, it reached a point where I needed to buy a sewing machine. I sat with my best friend and asked her for her support. We discussed the cost, how and when I could pay her back in time. When I acquired the sewing machine, I quadrupled my production in just a month.

Our inner circles can be of great help when growing a young venture. They see you work, they know how passionate you are about your trade, and they want to see you shine. Trust is a major factor to consider when borrowing from people we know. As I was about to finish paying my bestie back, sales were low and I ran late with paying the last two installments. To maintain healthy boundaries with her, I had to ask her for a few months allowance to clear my loan. Luckily, she empathized with my situation and gave me more time to pay her back.

   3.Mobile Financial Apps

The delay in paying my bestie strained our relationship a bit. We had to work through those issues and it made me feel hesitant towards borrowing from friends and family. However, I needed regular support with small loans that I was sure I could repay without having to quarrel with anyone. Banks ask for collateral, plus, I did not want a huge loan! A Ksh. 5,000 to Ksh. 10,000 loan on a regular basis was enough to keep me afloat. While talking to some friends, they introduced me to mobile lending. One brand came up often, Branch. I heard about it but brushed this off for some time.

One afternoon, I downloaded the app on the Google Play store. It analysed data from my phone – with my permission – and gave me three loan options with the choice to pay back in either weekly or monthly installments. I applied for a loan of Ksh. 3,100 to sign up for an art fair and received funds within minutes.

Over the next six months, I kept taking Branch loans to supplement my growing business needs. I remember having one client who ordered a 16-piece furniture moving set – one of my biggest orders to date! Sadly, she did not pay on time. Considering that that was my biggest project yet, I experienced a domino effect in my finances. At the time, I had taken a loan with Branch and couldn’t repay it that month. After the client paid me, I sought to clear my loan. I was so surprised that I was not charged late fees. I paid exactly what I borrowed. For my young business, every dime counts – and I was happy not to incur a cost that I wasn’t prepared for.

As I kept on borrowing loans to restock and buy more craft supplies, I was surprised that when I got a higher loan amount, the interest rates decreased and I got a longer repayment period. When I got my Ksh 6,600 loan I had 2 months to repay. Now I’m at Ksh. 31,500 & I can pay in up to 6 months! I learnt that when I reach the Ksh. 50,000 loan and Ksh. 70,000, I’ll get 10 months and 12 months respectively. It is satisfying to see my passion and consistency being rewarded.

Starting a business demands consistency, a clientele, and capital. When I started, did I have all the three big C’s? Not at the time. However, I learned that these elements come to be as you set your business in motion and find what works for you.

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