The biggest issue most startups face while in a nascent stage is finding enough capital or funding to kickstart the venture. Every business is unique, and in this article, I’ll discuss three practical ways to fund your new digital marketing agency.
In today’s digital era, it is a no brainer that digital marketing agencies are making a killing in the game. With over 4.6 billion active internet users worldwide, having an online presence is no longer a luxury but a necessity to all business owners. This is why companies pump a lot of money into their marketing campaigns, which mainly involves digital marketing.
“Nearly 356 billion U.S. dollars were spent on digital advertising in 2020. This figure is forecast to increase at a rapid pace in the upcoming years. According to the latest projections, digital advertising revenue will amount to 460 billion U.S. dollars by 2024.”
What do you have to do to be a part of this 356 billion dollar industry? How do you get your new digital marketing startup off the ground? For any new business, you must have some capital. The lack of funding is a primary reason why numerous digital agencies fail. However, do not be disheartened as there are various methods you can employ to get funding for your digital marketing startup.
Fund your digital marketing agency
Let’s have a look at three practical ways to get funding for your new digital marketing agency:
Bootstrapping is the act of starting and funding a business using your own savings and without any outside assistance. As earlier mentioned, every business has unique requirements, and as a digital marketing agency, the most important thing clients require is thorough knowledge and expertise in the digital domain.
There are many services you can offer as a digital marketing agency and if you have expertise in any of them, go right at it – get your first client and get working.
Ideally, if you’re to offer services such as SEO, for instance, the crucial requirements you’d need is a good internet-enabled computer and SEO tools. Fortunately, you can take advantage of free trials with tools such as SEMrush, meaning you can work for your first client without having spent a ton of initial startup capital.
There are various advantages associated with bootstrapping as a way of starting your venture. Some of them include:
- You won’t give up any equity of your company
- Since you haven’t borrowed any money, you won’t have to pay any interest
- Since there are no investors, you don’t have to split the profits with anyone else
Crowdfunding is another popular method for funding startups. It is also a great way to raise money for your digital marketing business. There are many crowdfunding sites to help you out such as CrowdFunder, Fundable, Kickstarter, and AngelList, just to name a few.
Regardless of the platform you settle on, there are two main ways to get funding for your startup: interested parties will pitch you within a pool of investors or they allow you to raise money from members of their platform. However, you ought to specify your business goals, capital needs, and the reasons why you need the money. In most cases, people on crowdfunding platforms will either make financial pledges, donations, or promise to pre-purchase products or services to kickstart your business.
Before launching on crowdfunding platforms, it would be prudent to understand that to increase your chances of getting funded, you need to first build credibility. You can build your agency’s credibility by highlighting some of the work you’ve done for previous clients, how you would be helpful to investors, and how they would benefit from supporting your launch.
Building your personal credibility is also vital, and this means getting important digital marketing certifications which you can find on some of the best online course platforms. This will place you far ahead of the competition in the race to getting funding for your startup.
Seek out venture capitalists
If you already have a validated customer base with traction and would like to go in full force, then pitching venture capitalists would be ideal. A venture capitalist (VC) is someone that will give you the required capital to kickstart and scale your business in exchange for a percentage of equity share in the company.
Venture capitalists will not only provide you with the required startup funding, but also offer the necessary guidance and connect you with the right people to help accelerate business growth. This is because VCs are interested in making quick profits out of your business, making it an ideal method to fund your new digital marketing agency.
Get your new digital agency off the ground
There are many other options that you can seek out, but they often come with lots of strings attached. For instance, you can go for bank and NBFC (Non-Banking Financial Corporations) loans. However, be sure to go through the fine print to figure out the repayment plan, and what contingencies you need to offer should the business fail.
The digital marketing field is crowded with stiff competition. This means you need a sure-fire way to fund for your startup without hurting your financial status, such as falling into debts at such an early stage. Bootstrapping, crowdfunding, and seeking out venture capitalists will provide you an easier sail as you get your business on its feet.
Hafiz Muhammad Ali is CEO of Omnicore, a Healthcare Digital Marketing Agency. He is a Ph.D. candidate and holds an MSc degree in Digital Marketing Leadership from the University of Aberdeen. He is a best-selling author of “Digital Passport” which is the first of its kind career book that offers a practical roadmap to a promising career in digital marketing.
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