How to finance a business

By The Rebel School CEO, Simon Paine.

These are 5 main ways to finance a business.

1. Use your savings

2. Borrow money (get into debt)

3. Get investors

4. Start-up grants

5. Start for free

As you look down the list did any of those options grab your attention? Is there any of those five options that you go either surely that’s not possible or actually that sounds really good I think I’d like the option?

Clue: number five is the one that should’ve grabbed your attention but more on that shortly.

1. Use your savings.

If you’re lucky enough to have spare money you might have been able to build up a slush fund of cash to use in your business. You might be someone who’s using your redundancy payment to start a business, or maybe you sold a house and you’ve got some of the equity stashed in a savings account somewhere (hopefully not under the mattress).

The irony here is it might seem like you’re in a really good position but you are in the danger zone of wasting your hard earned precious cash. Why? Everyone that I’ve ever met and it’s use their savings or redundancy of more than a few hundred pounds or dollars has wasted the money. When people start a business with money, they tend to spend the money on the wrong things. We tend to spend money on brand design, websites, business cards, all the things that we think we need in order to make our business appear to be professional. All you’re going to do is waste the money. We tend to use money to make a business appear perfection. Are you a secret perfectionist? Are you a blatant perfectionist? If you are, there’s a good chance you’ll be using your savings to buy the wrong things. So why would you be buying the wrong things? More on that in the moment.

2. Borrow money (get into debt).

I recently run a session in a high school and asked for students to put up their hands if they think you borrow money to start a business. Out of a class of 17 students, 13 of them put their hands up and said that you need to borrow money to start a business. This is how effective the marketing strategies of banks have been over the decades.

It’s in our consciousness worldwide (we run courses in five continents) and it doesn’t matter if you’re in Texas, London, Casablanca or downtown Windhoek, Namibia there is a general belief that it takes money to make money and in order to start a business you need a business plan and you need to borrow money.


When is the worst time to borrow money in business? It’s at the beginning because you haven’t got any customers yet, you haven’t tested your idea and you don’t even know if you’re going to like it.

A little bit like the people with the “good fortune” to have money in the bank and using the savings to start a business you’re in even more danger because you’re using someone else’s money to waste on things that you don’t need rather than your own. That’s gonna put you in debt and that’s gonna hold you back from achieving the things that you really wanna achieve in life.

Now loan providers will entice you with all sorts of things to get you to take a loan. For example software (that you don’t need and will never use), a dedicated business manager (I will sell you things that you don’t need) and free business banking (you don’t need a business bank account when you start and you can get free banking anyway) and so on. It’s a bear trap. And you are a juicy bear waiting to be trapped. You didn’t expect me to say that today did you.


3. Get investors.

Something to consider for your own well-being is to see if you can figure out which moments of the day you are able to fully immerse in your business versus which moments of the day you’ll need to be fully present with your children. Running both things at the same time can get really overwhelming so being smart with your time, to enable you to focus as much as possible with a clear head will really help – even if it’s just for half an hour or an hour a day.

So when you’re time poor starting a business, think of the activities, the products and service ideas that you have the biggest impact positively on your well-being and your cash situation. What ideas will shift the needle the most? What would fill your heart with happiness if you could spend your time doing it?


Getting investors or VC (venture capitalist) is not the golden bullet that lots of people think it is. Investors are a little bit like banks – they will want their money back but with WAY MORE interest; Investors who lend money and invest in businesses are taking a bigger risk, so they expect a bigger return. And especially in the early days of starting a business we are at risk of falling into many many bear traps with investors. You might be lucky enough to have friends or family with pots of cash that might be interested in giving you money to start a business but this is a bear trap in itself because you all know the family and business is a bit like trying to discuss god or politics over pasta – it doesn’t end well.

Of all the people we meet, starting a business, a tiny tiny percentage of their investor ready, it’s literally one person in every 200 now there’s about 50 people in every 200 and think their businesses in the festival but it’s really only one or two. And most people we meet think they are one of those one or two people (they’re usually not). But if after reading this article you think that getting investment for your business is still something that you want to do then my best advice would be to find your local VC network – they are usually called Angel investors.

They will run events and have resources on their website you need to become an expert. If I was launching a business and thought that I was investor ready then my next step would be to make contact with local investors and have an informal meeting with them to find out what it is that they’re looking for, their experience and terms. Secondly, I want to make contact with a business that they’ve invested in to find out what the experience was like for them. Those two conversations are going to be teaching more about getting an investment than anything else you do. And it’s not just about taking the money, it’s about finding people that you’re going to enjoy working with and that you’re going to learn from that can add value to what it is you’re trying to do as well as provide you with funds.


But here’s the really interesting bit about investment if you’ve been able to get your business off the ground and make sales without investment not only does it make you more investable increases the value of the business that you’ve already created. That means they’re going to take less of the equity because you’re less of a risk it puts you in a stronger negotiating position. So, keep reading until you get to the end of tip five because that’s going to help you keep more of the profit that you make.

4. A start up grants.

Back in the olden days there was loads and loads of money around and councils and charities and organisations were throwing free money at people especially in the early 2000s. There was lots of grant funding available. 

Now it’s 2023. There are recessions, Covid impact, the war, energy price and inflation – prices for everything are going through the roof. No prizes for guessing what’s the impact of that on available current grant funding for starting a business.

It’s still worth checking but know this. You’re going to have to jump through some hoops if there is grant funding available. What I mean by hoops is forms to fill-in, pitches and panels to convince and a waiting game for people to give you money. That means you’re gonna have to write a business plan of some kind, whether it’s a business plan template or using their forms. This time investment, it’s time that you should be spending building your business and making sales.

Think about the level of reward versus the amount of time and effort you have to put in in order to get it. I used to administer the grant funds and I can say with confidence that the vast majority of people that were successful in getting a grant spent the money on the wrong things. A little bit like those with savings, but instead of wasting your own money you’ll be wasting public money. At least it’s someone else’s, but it’s not going to help you launch your business.

If you are going to get a Grant, something I want you to think very carefully about what you can spend it on that would directly lead to sales. Where do you find grant funding? Jump onto your local council website and make contact with the business services team they are the people most likely to be tuned in to grant funding is available.

5. Start for free

What is this trickery I hear you ask the Rebel School (formerly PopUp Business School) has been teaching how to start a business for free for 10 years. This is why we exist in the early days we realise the vulnerable people are being convinced to write business plans and take loans to start a business and we believe this is wrong. It’s based on the belief that it takes money to make money and we knew that this wasn’t true in fact our School itself was started for free!

We used our customers money to grow the business! Does that sound more interesting to you?

Here is how to start a business for free:


Step one is dial back the cost of your business start up as much as you possibly can. 

Bootstrap everything and remember you don’t need as much as you think you do to get started. People say but I need a premises but I need insurance but I need marketing etc. and I reply with no you don’t because you haven’t got a customer yet. When you’ve got a customer, then you need that stuff.


Get things and do things for free (by asking/googling). 

– You can get a premises for free by pitching to the owner and maybe finding some kind of ‘what’s in it for them’ common ground.

– You can get business cards for free website for free (remember it doesn’t need to be perfect to start you just need to start).

There are so many ways that you can promote your business without spending any money (insert podcast episode).

If you can’t get things for free, you can borrow them you can borrow students, venues, equipment and so on, all you need to do is ask the question.

– You can barter for things do a swap deal make dinner for somebody in exchange for their expertise in Facebook Ads or whatever it is.

– You can sell stuff that you don’t need anymore, that’s lying around your house and create a little slush fund if you do need to spend some money. You’re less psychologically tied to that part of cash then you are your current account because there is less risk involved. And it’s kind of fun and it helps to up your sales game.

Use your client's money


Here’s the real game changer if you want to use your customers money to grow your business what you need to do is to create a pitch and some kind of evidence that your business exists so that your potential customers 100% trust in what you’re going to deliver. This is how brand-new houses are sold before they’re built. If you can sell £1 million house that doesn’t exist in an empty field and I’m sure you can sell a bit of yoga coaching, some bespoke art, a cleaning service or whatever it is.

Your job here is to get payment in part or full in advance for whatever it is that you’re selling.

Then you get to use your customers money to grow your business not yours.

I don’t know about you, but that’s exciting for me.


 So what is your Nextep?

Simon Paine

Simon started the Rebel School (formerly Pop-Up Business School) with Alan in 2011.

As well as helping start-ups realise their business dreams, he has coached, trained and facilitated senior leaders from some of the world’s most famous companies including Microsoft, British Airways, and Thomson Reuters.

Find out more about Simon on our team page.