Dear Professor Bruce, I’m an entrepreneur developing a web-based application in the healthcare market. My budget is tight, and I need help raising money to hire staff and bring my product to market. With the banks making it so hard to lend money to entrepreneurs, what choices do I have?
Answer: Analysts say that consumers are willing to spend $14 billion dollars on certain digital health technology products so congratulations for selecting a market sector that has such a rosy future.
Mike Edwards, President and CEO of LX Ventures, a technology incubator that launches, integrates, and acquires early stage high growth technology companies, offers several tips:
Consider finding an incubator or accelerator program where you may get connected to angel investors, economic development coalitions and venture capital firms as well as refine your business model and get advice from mentors.
Business incubators and accelerators provide young businesses with office space and shared amenities including broadband connections, meeting rooms and like-minded fellow entrepreneurs in a campus like setting. In this setting, entrepreneurs get advice from business mentors associated with the incubation center. Entrepreneurs usually stay in an incubation center for a year or more while business accelerators foster a shorter, more intense incubation period.
Another new funding option taking hold is an exciting new platform called Angel List. Angel List, www.angel.co, is a remarkable platform for startup entrepreneurs that help bridge the gap for startups to reach investors. Angel List is blowing the doors wide open to what has been historically a very clubby environment and is providing immense value to entrepreneurs.
As bank loans have become harder and harder to obtain, some entrepreneurs are turning to business grants for funding. You can check with your local government agencies and major corporations to see what funding may be available to expand your business.
For further information, www.lxventures.com
(Bruce Freeman is president of Proline Communications and co-author of “Birthing the Elephant.” He teaches at Seton Hall and Kean universities. Email Bruce@Smallbusinessprof.com. Follow Bruce on Twitter @SmallBizProf and his Facebook page.)