Congratulations! You’ve got an awesome idea, done the necessary R&D to see if your idea is commercially viable and protected your product with patents – now it is time to find investors (or a good chunk of money) to fund your epic innovation.
Let’s take a look at how you can find funding….
1. Find an Angel Investor
Angel Investors (AIs) are a common way to find funds. AIs are wealthy individuals who provide capital in exchange for convertible debt or ownership equity. There are many pros and cons to AIs, and while helpful we recommend being wary. AIs are more willing to hand out their money than a bank, however, can expect as much as 10 times their original investment inside the first 5-7 years.
Ignoring the huge ‘interest paid’, Angel Investors treat the money as an investment, not a loan. This means that if your business/innovation falls flat they will not expect you to pay back the funds (whereas a bank most definitely will).
Wanting to look at Angel Investment? Check out Angel Investment Network, Business Angels, Innovation Bay or AngelList. There are many Angel Investors who specialise in funding the Engineering and Manufacturing sector. We suggest finding someone who understands your market so they can understand and relate to your business proposition.
2. Enlist the help of government initiatives
There are a number of government initiatives dedicated to encouraging entrepreneurship, with the Turnbull government paying a particular focus to innovation. There are some viable options within the Australian Government’s Business Division. The government-run AusIndustry Entrepreneurs’ Programme includes the Accelerating Commercialisation scheme. This scheme provides expert guidance, networking opportunities and financial support up to the value of $1million over two years.
By gaining access to experts and industry professionals you will be able to learn an incredible amount of information and see the potential for your product, plus $1million of government funding is nothing to be sniffed at.
3. Make friends with the bank
Ahhh, banks. Depending on your financial position (whether business or personal) and their belief in your success you could be eligible for a bank loan. Of course, this loan will operate like any other loan meaning you must pay it back regardless of your idea’s success (or failure).
4. Utilise your business’s assets
For many of you, you already have an established business which is excellent! You are one step ahead of the crowd. Speak to your CFO or accounting team and see how much your business can dedicate to this innovation. Tip: a stunning and compelling presentation showing the potential of this new innovation never hurts.
6. Become the king/queen of press releases
The more places you can have your idea seen, the more public and investor interest that you can generate. Sprinkle information about your innovation everywhere (provided it is safely patented) so that wherever people turn they are seeing your idea. People want to invest in ‘the next big thing’ and by increasing your idea’s exposure you are increasing public interest (which will come in handy when your product hits the market) and increasing the potential investors you can attract.
You could try contacting magazines and journalists who focus on the engineering, design and manufacturing industries. Many specialist writers are always looking for the next ‘big thing’ and may be able to provide you with opportunities for interviews, feature articles and social media coverage.
In our business, engineering and innovation are our speciality. Our passion is providing creative solutions to ignite your vision. Do you have an invention you want to bring to life? Contact our team of engineers today.
Check out our article: From idea to prototype: How to Manufacture a Prototype to learn more about how to turn your idea into a reality.