FUNDING: Raising Capital For Your Business Post COVID-19

The outbreak of the novel virus Covid-19 has had a great impact on existing small businesses, especially in developing countries. SMEs in Nigeria have had to deal with anxiety over uncertainties that might exist after the crisis, challenges with cash flow, customer retention, and disruption in essential operation processes. Many have lost millions of Naira due to the economic implications caused by the pandemic, especially in industries that are customer facing.

However, in the midst of this, an array of companies have also sought out ways to raise finance to ensure their sustainability while also leveraging the relatively cheap opportunity to raise capital.

It is pertinent to note that of the many challenges faced by SME’s in Nigeria, the lack of finance is one begging to be solved. Statistics show that 80% of small businesses started in Nigeria fail within the first five years. This alarming rate of business failure is attributed to several reasons, the most commonly cited being insufficient capital, as well as poor access to credit facilities.

For a country suffering numerous infrastructural challenges, and a difficult business environment, the inability to raise sufficient capital presents itself as the deadshot to businesses. Credit facilities could have been a viable option, but this has not been the case.

A recent PWC survey has revealed that Micro, Small, and Medium Enterprises do not rely on banks to meet the majority of their funding needs. For the MSMEs interviewed during the survey, bank loans are impossible to get mainly because of their bureaucratic application process and high interest rate. About half of the respondents (50%) admitted that they did apply for bank loans over the last 12 months, but never ended up taking them due to their high costs. The report also noted that high cost of capital is one of the major costs to business operations in the country.

Thus, to aid startups and budding small businesses, these are a few alternative ways in which business owners can raise the much needed capital they require to start, sustain, and scale their businesses.

RELIEF FUNDS

The Nigerian government earlier in May had announced plans to establish an SME Survival Fund to sustain at least 500,000 jobs in ‎50,000 SMEs. The said funds will be targeting businesses in critically affected sectors such as hospitality, creative industries, road transport, tourism, and schools.

Interestingly, the plan states that these grants will be disbursed through microfinance banks and fintech credit providers. A three-month timeline has been earmarked for the disbursement of these relief funds and the scheme will be implemented through the Steering Committee on the MSME Survival Fund, the Federal Ministry of Industry, Trade, and Investment, and the Bank of Industry.

CROWDFUNDING

Crowdfunding is another popular way of sourcing for funds; it depends on a system of generating small investments from a large number of sources. It is believed that it is easier to raise small amounts of money from many people than it is to raise huge sums of money from a few people.

Some of the different types of crowdfunding are – Donation, Reward-based, Debt and Equity Crowdfunding, which is one of the most recommended. With equity crowdfunding, investors give money to business owners in exchange for a percentage of ownership of the company; then after a window of time, the company repays the investors with interest in return. Most times the investors receive repayment or reward with interest within a designated period of time.

BOOBSTRAPING

Provided that your business isn’t operating in an industry that requires lots of startup capital, like manufacturing or transportation, you can potentially fund your own venture—and it may be more feasible than you think. Although funding the business yourself carries lots of risks, it is important to consider your potential. If you believe in the vision for your business, you should feel comfortable investing your own money in your business. It also encourages potential investors who are willing to partner with you down the line.

SME SUPPORT ORGANIZATIONS (ACCELERATORS & INCUBATORS)

In recent times, we have seen the rise of accelerators and incubators in the Nigerian startup and SME scene. Numerous small businesses have been beneficiaries of the support of incubators and accelerators, such as Fate Foundation, Tony Elumelu Entrepreneurship Foundation, CoCreation Hub, Google LaunchPad, Y Combinator accelerator programme, to name a few.

Incubators are companies that provide support services such as office space, electricity, and business management training to small businesses. While an accelerator is a program that gives companies access to mentorship, training, investors and the support they need in order to maximize their growth.

 

 

Tips On How To Stay Focused At Work

With the new normal in place, we have already lost some steam and it shows from the deliverable timelines. So, while we try our best to stay on track and keen to finish the tasks at hand, we are weary about distractions and how to combat them. You might be extremely busy when something suddenly comes up that takes the time you should be spending on priority tasks. It could be a chatty colleague, a boss with a less important task, a notification from your phone, a social media prompt, an impromptu meeting or, if you are working remote,  it could be kids or siblings playing or chatting around.

Continue like this and within 30 minutes you have lost track and you cannot remember where you left off and why you do not seem to get back on track.

This does not sound too far from what you really experience daily. Well we have put down a few tips on how to stay focused while working.

  • Get Rid of Distractions

Before you set out on the day’s tasks, you need to get rid of the distractions to get work done. A good way to do this would be to define specific “focus time” where you turn off all distractions and notifications on your phone, ignore anything that would make you lose focus. With this, you are more likely to have your work be your focus.

  • Get in the Mix

Getting in the mix starts with setting up a To Do list for the day and getting excited about the task at hand. Also, go after each task in order of priority and urgency. Try to accomplish all the important tasks first before you handle smaller tasks.

  • Set Timelines

It is likely that you already have official deadlines, it is always a good choice to set personal deadlines ahead of the official ones. This way, you are likely to work at a good pace and get more done before the official deadline.

  • Take organized Breaks

Working for too long without taking breaks can be exhausting. So, organize your breaks to keep you fresh and smart. Ensure to stretch your legs often. You could also do some desk stretches or chat briefly with a colleague. Take some time off to go on social media this helps boost your energy and increase your alertness levels.

  • Drink water eat healthy

Ensure to keep a water bottle close to ensure you drink water often. Do not wait till when you are starving to eat. This is necessary to keep you stronger and your energy levels high throughout the day. This would help keep your body and mind together while working.

 

 

Tips to control your Spending Habits

Some people are in debts and are struggling to save money for the things they really want. No matter how hard they try to save money, it is just never enough. Even after getting promoted at work and start earning more, they always think that could fix their problems, but they still find themselves in such situation and they ask themselves; why? Well, the problem is not about how much you earn or have but your spending habits.

It is not going to be an easy task but with hard work, it is possible and the number one step is your willingness to change.
Below are some insightful tips on how to control your spending habits.

1. Ask Questions: Many of us are fond of not assessing our purchases and almost everyone is guilty of this. Assessing your purchases is more important when you are about to buy something. Also, we do impulse buying i.e., buying things not planned for. Impulse can make us buy things we will regret as we only think about the consequences afterwards. So, it is therefore very important to ask yourself; why am I buying this thing? When you ask this question, you are immediately reflecting about it.
Say for example, you want to buy a car. You ask yourself, why am I buying a new car? What is wrong with the one I am currently driving? Majority of the times we ask ourselves questions like this, who do not always find a decent reason for wanting to buy it.

2. Have a Budget: Creating and having a budget forces us to think about every purchase we make. Your budget can be daily, weekly, or monthly. When creating a budget, it is better to assign it to something meaningful to you. When you do this, you will be able to stop your meaningless and unnecessary purchases to keep within the budget and achieve whatever your goals are.

3. Willingness to change: You cannot be doing the same thing repeatedly and expect different results, it is not possible. One the main causes of some people’s financial problems is their unwillingness to change their lifestyle. You cannot be living an extravagant lifestyle and expect not to one day be faced with financial issues. It is not going to be easy but your willingness to change is surely a major step in curbing this.

10 Healthy Lifestyle Tips

1. Eat a variety of foods

For good health, we need more than 40 different nutrients, and no single food can supply them all. It is not about a single meal; it is about a balanced food choice over time that will make a difference!

2. Base your diet on plenty of foods rich in carbohydrates

About half the calories in our diet should come from foods rich in carbohydrates, such as cereals, rice, pasta, potatoes, and bread. It is a good idea to include at least one of these at every meal. Wholegrain foods, like wholegrain bread, pasta, and cereals, will increase our fibre intake.

3. Replace saturated with unsaturated fat

Fats are important for good health and proper functioning of the body. However, too much of it can negatively affect our weight and cardiovascular health. Different kinds of fats have different health effects, and some of these tips could help us keep the balance right:

  • We should limit the consumption of total and saturated fats and completely avoid trans fats.
  • Eating fish 2-3 times a week, with at least one serving of oily fish, will contribute to our right intake of unsaturated fats.
  • When cooking, we should boil, steam or bake, rather than frying, remove the fatty part of meat, use vegetable oils.
4. Enjoy plenty of fruits and vegetables

Fruits and vegetables are among the most important foods for giving us enough vitamins, minerals and fibre. We should try to eat at least 5 servings a day. For example, a glass of fresh fruit juice at breakfast, perhaps an apple and a piece of watermelon as snacks, and a good portion of different vegetables at each meal.

5. Reduce salt and sugar intake

A high salt intake can result in high blood pressure and increase the risk of cardiovascular disease.

6. Eat regularly, control the portion size

Eating a variety of foods, regularly, and in the right amounts is the best formula for a healthy diet.

Skipping meals, especially breakfast, can lead to out-of-control hunger, often resulting in helpless overeating. Snacking between meals can help control hunger, but snacking should not replace proper meals.

7. Drink plenty of fluids

Adults need to drink at least 1.5 litres of fluid a day! Or more if it’s very hot or they are physically active. Water is the best source, of course, and we can use tap or mineral water, sparkling or non-sparkling, plain or flavoured. Fruit juices, tea, soft drinks, milk and other drinks, can all be okay – from time to time.

8. Maintain a healthy body weight

The right weight for each us depends on factors like our gender, height, age, and genes. Being affected by obesity and overweight increases the risks of a wide range of diseases, including diabetes, heart diseases, and cancer.

9. Get on the move, make it a habit!

Physical activity is important for people of all weight ranges and health conditions. It helps us burn off the extra calories, it is good for the heart and circulatory system, it maintains or increases our muscle mass, it helps us focus, and improves overall health well-being.

10. Start now! And keep changing gradually.

Gradual changes in our lifestyle are easier to maintain than major changes introduced all at once. For three days, we could write down the foods and drinks we consume throughout the day, and make a note of the amount of movement we made.

While we provide quick emergency loans, we give  tips on how best to live a healthy life and make a good living. Please share and drop comments for further readings.