Teenage entrepreneurs are cropping up fast these days. Today’s teens are bright and full of great ideas that they are sure will make a huge impact. That is important because teens are starting their own businesses not just to make money, but to change lives and make the world a better place to live.
Teens have launched successful startups focusing on a wide range of industries including fashion, food, footwear, healthcare, technology, and more. There are even a few highly successful teen entrepreneurs who have launched their own businesses and then sold them for millions of dollars—all before they even turned 18.
There is one big hurdle that every teenage entrepreneur must make–getting funding to launch their startup. Regardless of how old you are, finding and obtaining the funds needed to start a business can be a highly stressful process. With that said, there are many ways teens can go about getting the money they need to get their operation off the ground.
Fortunately teen entrepreneurs don’t necessarily need a lot of money to get their start as real-world entrepreneurs and business owners. In fact, there are stories of teens that have launched million dollar businesses with as little as a few hundred dollars.
Luckily, there are also many avenues teenagers can travel to find the funding they need to launch their business ventures. Here are a few:
- Family Investors: The first type of investor a young teenage entrepreneur can turn to is one of their family members. Family members are the first likely resource for them to get money. Most of the time, families will give their young entrepreneurs start-up money without the expectation of it being paid back. Many teenage millionaires got their start with a loan from their parents.
- Crowdfunding Campaigns: Since the first one was launched a few years ago, crowdfunding has become a popular way for entrepreneurs of every age to secure the funding they need to launch their business ventures. For teen entrepreneurs, crowdfunding can be one of the fastest ways to obtain startup funding. Websites like GoFundMe, Kickstarter, and Indiegogo are perfect for asking the world to help raise funds to launch a business. Teens can tell their story, post videos explaining their business models and offer incentives to donors. Because crowdfunding is still very much a pitch, it’s helpful for teens to remember the best ways to market themselves.
- Business Plan Competitions: Business plan competitions can also be a great way to for teens to raise funds. The website comoffers a comprehensive database of business plan competitions to which teens can apply for funding. By participating in one of these competitions, teens can obtain the funding they need to launch their business ventures but they can also gain valuable technical assistance, support and industry connections. Some business plan competitions also offer winners the opportunity to receive guidance and mentoring from successful entrepreneurs.
- Private Foundations: Some, but not many, charitable foundations offer grants to help teen entrepreneurs launch their businesses. For example, the Conrad Foundation Spirit of Innovation Challenge provides funding for teams of teen entrepreneurs. The annual program is a multi-phase business and technical plan competition that is free and open to students ages 13 to 18 from around the world. The Challenge celebrates the life and entrepreneurial spirit of astronaut Pete Conrad, the third man to walk on the Moon.
The program challenges teens to work in teams of 2-5 to use science, technology, engineering and math skills along with creativity, collaboration and entrepreneurship to develop innovative products and services to benefit humanity and address global sustainability. Categories include: Aerospace and Aviation, Cybertechnology and Security, Energy and Environment, and Health and Nutrition. Teams from afterschool programs, science clubs, homeschool organizations, and charter schools are also encouraged to participate. Award ceiling: $10,000. The deadline for submission of applications is usually on or about October 15 of each year.
- Bank Loans:A bank loan used to be the “traditional” route for an entrepreneur to obtain funding to launch or grow a business. Today, regardless of age or industry of the entrepreneur, this option is employed less and less.
As they apply to teens, those younger than eighteen will need a parent to co-sign for their loan. If this is the chosen option, teenagers will need to have someone go over the paperwork carefully with them so that they understand all the terms of the loan.
- Credit Cards: Using a credit card to launch a business is not the preferred method, but if your funding needs are not that great, it can be a viable option. High interest rates can be a major drawback to launching a business using credit cards however. Teens must also remember that minimum monthly payments can be high. Forgetting to pay a credit card bill can lead to harmful and lasting consequences such as a poor credit score and a significant debt burden. Under certain circumstances, a credit card can be a viable option for teen entrepreneurs to get capital, but they should be used sparingly.
With more and more teens hoping to walk down the path of entrepreneurship, there are also a growing number of other resources designed to help them. Here are few options teen entrepreneurs can explore to support them in realizing their business ownership dreams:
- Small Business Administration: The SBA is an exceptionally good resource for teen entrepreneurs. The website has a special section devoted entirely to teens interested in entrepreneurship. Resources include online courses, forms, working groups, success stories and more.
- com: This website is dedicated to supporting teen entrepreneurs searching for venture capital to launch or grow their startups. Youth can even submit their business ideas to the organization for funding.
- Teen Business.com is a website entirely devoted to supporting teenage entrepreneurs. Whether you’re looking for news, articles, resources, tips or information for parents, you’ll find it here.
- Social Venture Network: For teen entrepreneurs with business ideas that will make the world a better place, SVN offers a wealth of resources.
Teens Can Get it Done
While not every teenage entrepreneur will launch a business and later sell it for millions of dollars, starting even the smallest venture is a rewarding experience that offers countless long-term benefits. Being an entrepreneur can teach teens important life lessons and develop valuable skills that will facilitate many years of personal success.
If you are interested in learning more about obtaining grant funding or starting your own business, I encourage you to discover more of the resources on my website. I have tons of amazing tools and strategies that will help any entrepreneur take an idea from the drawing board all the way to the marketplace.
Think you have a better idea for helping teens obtain the grant funding they need? Please, share it here. There are tons of ways to get funding and only by exploring each of them together will we be able to figure out what works.