How to Bounce Back from Financial Setbacks. Advice for the Creative
Updated: Mar 22
Welcome! Thank you for popping in today to check out our tips and tricks for financing your dream business. This article is provided by contributing author & entrepreneur Derek Goodman. A big thank you to Derek for this wonderful list of advice!
Derek Goodman is an entrepreneur. He’d always wanted to make his own future, and he knew growing his own business was the only way to do that. He created his site Inbizability, to offer you tips, tricks, and resources so that you realize your business ability and potential now, not later.
Past financial setbacks shouldn’t keep you from pursuing your dreams of launching a creative business, especially if you’re passionate, skilled, and prepared for the long and oftentimes stressful startup process. This guide created for readers here at Inside Fashion Design (IFD) will tell you everything you need to know about obtaining funding for your startup and getting your creative business off the ground, regardless of the financial setbacks you’ve experienced in your personal or professional life. Let’s begin!
Bounce Back Financially
Whether a former business failed, you’ve previously filed for bankruptcy, or you’ve experienced another financial challenge, you’ll first need to recover from your setback. This means giving yourself some time to pay off any bills that affect your credit score, cut unnecessary spending, and find a consistent stream of income — rather than immediately starting a business after experiencing a financial setback. Legally, you can start a new business immediately after filing for bankruptcy, but qualifying for a loan may be a challenge.
After you’ve completed these steps, you’ll need to explore new financing options or look for ways to start your business without borrowing money. If you launch a home-based business, for instance, you’ll save on rent and utilities, especially if you use personal equipment and convert a spare room into an office.
If you know you’ll need to borrow money to cover the cost of equipment, inventory, or office space for your creative business, consider these options:
-Leasing business equipment or buying these items secondhand
-Crowdfunding your startup
-Borrowing money from friends and family
-Finding a startup accelerator
–Renting a coworking space if you can’t work from home
-Applying for a bad credit business loan
Become an Expert in Your Craft
As you recover from your financial setbacks and look for ways to fund your startup, it’s also important to learn as much as possible and become a master of your craft. If you’re starting a fashion design business, for instance, here at IFD we offer courses, tips, reading recommendations, and other learning opportunities to inspire and empower design students and entrepreneurs. Other online resources for creatives include the Center for Creative Entrepreneurship (CCE), One Club for Creativity, and the Professional Association for Design (AIGA).
Launch Your Creative Business
Once you’re ready to launch your new business, you’ll need to complete several important steps. These include the following:
Conducting market research
Identifying your target audience
Drafting a business plan. Visit Score.com for a free business plan template
Applying for financing, if necessary
Choosing a legal entity
Naming and branding your business Creating your product
Since you’ve experienced financial setbacks in the past, a limited liability company (LLC) will be an excellent choice of legal entity as you get your new business up and running. LLCs are meant to protect your personal finances in the event of lawsuits or business debts, and other benefits of limited liability companies include tax advantages and management flexibility.
“So, how do I start an LLC?” you may wonder. Typically, it’s best to begin the process by reviewing the LLC rules in the state where you live and checking to see if your chosen business name is available. Then, you can use an online formation service to file your Articles of Organization or Certificate of Formation, or you may file directly through your local Secretary of State’s office. As another option, an attorney can walk you through the entire business formation process for a fee.
Launch Your Dream Business
Experiencing a financial setback shouldn’t keep you from launching your dream business, and it doesn’t have to if you take the time to recover financially and plan out your next business venture. By giving yourself some time to bounce back, explore new funding opportunities, and become an expert in your craft, you’ll set yourself up for success as a creative entrepreneur!
Are you ready to launch your dream career as a fashion designer? Subscribe for a free Inside Fashion Design (IFD) account to find workshops and events, tips for design professionals, and other inspiration for creative entrepreneurs!
