General Question

bpeoples's avatar

Micro-investing in the US?

Asked by bpeoples (2546points) May 14th, 2009

A friend of mine and I are starting to put together an electronic device, but starting to run into funding problems with the R&D.

Basically, neither of us has enough cash floating around to really fund the project, but the amount of cash is relatively small—$1000 would get us through R&D and ready for production.

Pre-sales through wholesalers should get us the funding to launch the product. While this is a consumer item, it’s a fairly small market—if we sell 200 in the first year, we’ll be stunned.

Our break-even point is pretty decent—20 units wholesale will cover the R&D costs.

So—any sources for this kind of micro-investing?

Within a week, we’ll have the first two prototypes in hand, but what we need to do next is get test units out so we can start getting good reviews and fix any beta issues.

Should we start looking for pre-sales once we have the prototypes and can start doing videos about them? Should we just look for small investors?

Any thoughts would be appreciated.

Observing members: 0 Composing members: 0

5 Answers

cwilbur's avatar

Generally, money on that kind of a scale is provided either by the investors themselves (“credit card venture capital”) or by angel investors—people who have money to lend on a good word and a handshake. If you’re reasonably sure this will be a success, you could put together a business plan and try for a business loan from a bank or credit union. If both of you have reasonable credit, it shouldn’t be difficult to get funded.

RareDenver's avatar

I take it you are in the US from the mention of $. Here in the UK we have several charities that help fund fledging enterprises for example

It’s a bit of a small amount to go to a bank for a small business loan but a personal loan should be easily available for that amount. Or you could just get friends to chip in and then pay them off with any profit?

bpeoples's avatar

@cwilbur—yeah, we were planning that scheme, but hit a snag in that it’s a bit more money that we thought (bad pre-research on our part)

@RareDenver Getting small investments from friends is my current plan, thanks!

YARNLADY's avatar

There are several choices here

augustlan's avatar

Have you asked your parents? What about the SBA?

Answer this question




to answer.

This question is in the General Section. Responses must be helpful and on-topic.

Your answer will be saved while you login or join.

Have a question? Ask Fluther!

What do you know more about?
Knowledge Networking @ Fluther