A Guide to Investors for Women/Minority Fashion Designers

Growing a fashion venture from the grassroots requires tremendous capital to generate an active passage for resources. Aside from an elaborate business plan and freshly baked ideas, fashion entrepreneurs need finance in advance. Fashion is one of those distinct business sectors where raising money comes first. It’s something that one should be prepared for when making an entrance into the billion-dollar industry. Simply put, a new fashion-oriented business must secure an investment source in terms of reliable investors.

However, managing a beacon of the required capital may not be a piece of cake. The fashion industry doesn’t receive as much prominence in several countries as it needs to flourish on a developed scale. Even if we set apart the cultural obstacles, the history of leading global brands clearly depicts the ups and downs a growing fashion enterprise goes through along the way. Hence, ‘how to find investors’ becomes an inevitable dilemma.

Regardless of how risky and obscure an upcoming fashion venture could be, women and minority fashion designers must prepare for whatever challenge they will come across in the route to success. As long as the designers acquire proper knowledge of the domain with a well-researched business roadmap, nothing can possibly go wrong. Although, one needs to be precise and decisive about the resources they approach for their business. This is an explanatory guide for women and minority fashion designers on how to get investors.

How (& when) to get funding for a fashion startup?

The beginning is the most intricate span for any business to flourish into a renowned brand. This is the commencement point that will direct the entire growth from then onwards. This is why ‘how’ & ‘when’ are some of the most essential aspects of a resource collection strategy.

To simplify this quest, fashion designers will need to estimate the requirements in a more pragmatic way. A clear vision of vital resources, workforce, and the material will enhance and speed up the decision-making process. Closely calculated data can help female fashion designers attract investors effectively. That’s how powerful and influential real numbers can be!

In addition to boosted resource opportunities, this form of planning can also bring up the strategy components that entrepreneurs often miss at the beginning of their business. Now let’s move on to the part where we will discuss the sources of resources/investment.

How to get investors: top investment opportunities for women and minority fashion designers

1. Savings from previous jobs

How to get funding for a startup? This question becomes arbitrary when an entrepreneur has both an idea and sufficient savings. Any idea can survive on little fundings, given an approach, efficient guidance, and timely execution. Applying a substantial amount of savings from previous jobs will incite fashion designers to get the most out of their investment. A conclusive share of the money will impose as a coherent force that will drive fashion enthusiasts to limit the expenses, specifically in the initial phase.

Even if fashion designers lack savings, they can consider working part-time for an enterprise while investing the rest of the hours in market research and planning. Remember that one can never have enough research data for an upcoming fashion-related venture. No matter how many years of experience fashion designers have, market trends and assessment data will always have something new for booming entrepreneurs.

2. Peers who are familiar with your work

It has never been easy for women designers and minority fashion designers to make it big in the industry. From the era of Coco Chanel to the notorious history of Gucci's downfall, we have seen the struggles of earning a remark in the fashion world. Fortunately, our generation has the advantage of social-economic development that allows women and minorities to open up about their occupational preferences and accept financial support from family and friends.

Speaking of support from family and friends, fashion designers can leverage the opportunity by asking their family members or close friends for investment. First of all, it will be simpler to connect with them and let them know of the business plans and strategies. It is far easier to pitch someone who has seen fashion designers’ work and functional ethics for financial support. There will be little to no legal obligations accompanied by emotional support.

3. Taking a chance with bank loans

Bank loans aren’t easy to get anymore, and neither are they convenient to get rid of. But it is the answer to ‘how to get funding for a fashion startup’. So, women and minority fashion designers can’t really rule out this option. Besides, not all bank loans lead to a nightmarish end. However, it can certainly create a dilemma for fashion designers who are already stuck with previous bank debt.

As we have discussed earlier, all fashion entrepreneurs need is a strategic layout of the next 6-month post-launch plan for their business. Though, the alternative of bank loans will need the designers to provide security as a guarantee for acceptance. Moreover, there’s a chance that the entrepreneur will not receive the exact amount of money required for the funding. All in all, the ultimate success in fetching a bank loan depends on how women/minority fashion designers represent their plan to the bank.

4. Financial support from contests

If an idea has what it takes to make a difference, it will get all the needed support and resources in an instance. The last decade has seen top ventures and startups grow like wild grass with the help of independent-funded bodies and contests run by government sectors. In fact, many developing countries now have discrete funding departments that prominently help promising entrepreneurs with requisite financial resources.

How to find investors on a competitive platform? Now that’s the part where struggling fashion designers can utilize their assessment skills. They can search for local authorities or ongoing competitions where they can exhibit their brand. Aside from it, effective analysis of trade organizations will also allow new fashion designers to explore the ground of possibilities for their fashion venture. In some countries, talented fashion designers also receive grants and scholarships funded by industrialists and market giants for small and medium-scale fashion businesses.

5. Crowdfunding using the right platforms

Questions like ‘how to start a business?’ or ‘how to find investors?’ in the digital age don’t make much sense. The internet is flooded with useful sources and influential platforms where fashion designers can receive the assistance and capital support they need for a new business. Crowdfunding is one such thing that can provide the necessary means to a developing venture.

Backed by the monetary contribution of a large number of investors, crowdfunding is one concrete step towards a seeding fashion designing business. Plenty of crowdfunding portals on the internet are used to bring innovative ideas in front of the relevant audiences to subjugate the gap between startups and investors. Although, these financial resources will expect the seekers to present a layout for incentives and equity.

These investors on the internet are capable of recognizing talent beyond any gender, race, or community. Therefore, getting investment from crowdfunding is a quick and convenient way to nurture a rapidly growing fashion enterprise. Kickstarter & Crowdcube are some of the most famous online platforms where women and minority fashion designers can easily get in touch with potential investors.

6. Pitching ideas to angel investors

If you believe in your idea and execution, there’s always some hope for gaining the trust of angel investors. These are the financial supporters who acquire a substantial amount of wealth either from their ancestors or from existing businesses. The term ‘angel’ defines the scale of investment these individuals are willing to splurge on a growing fashion firm.

However, connecting with such high-profile investors and convincing them about the prospects of a fashion-related business isn’t going to be that straightforward. Women fashion designers will need to formulate a strategic structure of their business where the involvement of the investor is clearly explained. The business roadmap should have an integrated set of data that briefly clarifies the requirement of different resources, a defined timeline, and benefits for angel investors.

Women and minority fashion designers will need to make their investors believe that they exhibit the needed experience, skills, and knowledge for the newly built business. Once these fashion designers win their confidence and credibility, getting capital from angel investors can be the best option for a growing brand.

7. Factoring for funding with bookings and prior orders

There are several old and reliable ways to get sufficient funding that women and minority fashion designers can consider for their fashion brands. Factoring is one of them. As per this decades-old concept, designers can collect orders before a particular season. Then, they can present this order record to a potential company looking to invest in a profitable deal. These companies pay upfront to fashion entrepreneurs in exchange for a discussed profit share. All in all, this is the safest mode of investment for women/minority entrepreneurs.

8. Venture capital financing for emerging brands

How to get funding for a startup from a group of successful corporations? If that’s the question bothering you, you can always turn to Venture capital. It is the most significant form of financing that you can help a fashion brand emerge from scratch. It is a promising funding source initiated by a group of private firms that evaluate the essence of a business in terms of growth potential and user traction. Apart from a full-fledged business execution plan, a subtle glimpse of leadership and teamwork can also help fashion entrepreneurs obtain financial assistance for their new business.

Final words for women/minority entrepreneurs

While pitching to potential investors for a noteworthy sum of funding, try to provide crude details in your strategic roadmap. Steer clear of a seemingly incomprehensive blurb as it can put the credibility of your ethical façade in an endgame. Also, optimize the involvement of your investors to let them know that your growth is just as crucial for them as it is for you. 

We at Fashinza help fashion brands and independent designers connect with the most brilliant apparel manufacturers. Whatever your requirements, we’ll help you find a manufacturer that fits in perfectly. Besides, our complete ownership of the process from delivery to design will allow you to rest assured. Visit us here now!