I've spoken with two organizations regarding a partnership on an event promotion. I need 40k to fund the event and would then receive the full revenue, estimated to be 120k. My question, having never started a business before, is how would I go about getting that first $40,000?
Congratulations on the entrepreneurial spirit it takes to start a business. The better you can demonstrate the outcome from their investment, the less of a risk you'll be perceived to be.
The best way to find any money for investment is to anchor the costs of the investment against the financial upside.
Without directly answering your question of where to find the funding, I would say this: the clearer the path to that estimated 120K of revenue, the less expensive it it to find someone with the 40K to help you kickstart.
Sounds like you're well on the way to validating your idea.
I've helped several people with this type of dilemma. The first option is to agree to a contract and ask for installments for payment. Most companies understand you need capital to conduct your operation and will agree to give you a portion up front. Option 2 would be to secure an LOI and seek either a high net worth individual or someone willing to provide contract financing. Contract financing can get extremely costly and I would view it as a "last ditch" effort. My recommendation is to push for an installment. Hope this is helpful, best of luck.
An easy answer would be to pre-sell tickets so the amount raised covers your $40k requirement. In doing so, the attendees are acting as the investors.
With that said, accepting money as an investment is a commitment that should be taken very seriously. Be sure that you can deliver on your promises.
Bets of luck!
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