Arielle Loren is the founder of 100K Incubator—the first business funding mobile app for women in both Apple and Google’s app stores. The story was part of her “Show Me the Money” workshop held at the Create & Cultivate Vision Summit in Miami.
Photo: Courtesy of Arielle Loren.
UNDERSTANDING CAPITAL AND HOW IT WORKS
(aka why your creative business needs money to scale!)
There are three categories of funding: grants, equity-based investments (what most investors require), and debt-based funding (business loans, lines of credit, etc.)
Let’s talk about debt though… there’s a difference between consumer debt for vacations and clothes—and strategically using a business loan as working capital for your business.
For example, if you charge a bunch of clothes on your credit card, those clothes can’t make you money and help you pay that back. You have to go to work and actually do that.
But if you invest the $5,000 you received from a business loan and turn it into $15,000 in sales, that means there’s a $10,000 gross profit. Now that’s worth considering a business loan, and it’s that mindset that you need to have when considering all funding options for your business.
PREREQUISITES FOR FUNDING
(aka what you need to get your money!)
Funding Budget
50-70% Advertising or Direct Revenue Generating Activities
30-50% Infrastructure—Sales Funnels, Photo and Video Shoots, Websites, Consultants, etc.
Average Personal Credit Score
Minimum 620 and up
Register Your Business Entity With Your State Government
LLC, S-Corp, C-Corp
Save money by registering directly on your state government’s website
Register Your Business for an Employer Identification Number (EIN) with the IRS
This is 100% FREE at irs.gov
Open Your Business Bank Account
Your Personal Finances and Business Finances Cannot Be Co-Mingled
File Your Taxes and Annual Report
THE 3 LEVELS OF FUNDING
(aka figure out where your business stands for the highest approval rates!)
Level 1: Zero (aka pre-revenue) to $3,000 per month in sales
Business Credit Cards
Personal Loans
Home Equity Loans or Lines of Credit
Crowdfunding
Level 2: $3,000 or more per month in sales
Pitch Competitions
Business Grants and Government Contracts
Government Small Business Loans
Payment Processor Loans
Private Business Loans
Business Lines of Credit
Level 3: $9,000 or more per month in sales
Angel Investing
Venture Capital
About the Author
Arielle Loren is the founder of 100K Incubator, the first business funding mobile app for women in both Apple and Google’s app stores. She’s helping 100,000 early-stage women entrepreneurs get funding for their businesses and scale to 100K+ in yearly sales. She is also a graduate of Harvard University, where she holds a master’s degree in Management and graduate certificate in Strategic Management. Additionally, she also holds a graduate certificate in International Business Management from Georgetown University and a bachelor’s degree in Social and Cultural Analysis and a certificate in Producing from New York University.
Visit 100kincubator.com for more information, download the app, and start your free trial.
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