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5 Creative Ways to Fund Your Startup Beyond Traditional Loans

When most people think of funding a business, they picture walking into a bank and applying for a loan. But for early-stage entrepreneurs, that’s often not where the journey starts. 

“Securing a traditional small business loan for a start-up business isn’t easy,” says Carolyn Cassin, CEO of MWF, a statewide CDFI lender. “But the truth is, most successful founders start with a creative mix of capital that gets them to the point where they can apply for traditional funding.” 

Cassin knows what she’s talking about. Under her leadership, MWF has helped hundreds of entrepreneurs access capital through nontraditional means — from pitch competitions to microloans. Here, she shares some smart strategies to fund your business when you’re just getting started. 

1. Start with Friends, Family & Personal Investment 

“For better or worse, most startups begin with what we call the ‘Three Fs’ — friends, family, and fans,” Cassin says. “That’s your inner circle — people who believe in you before anyone else does.” 

Whether it’s $1,000 from a cousin or savings you’ve set aside yourself, these early dollars help you test your concept, get some traction, and show lenders that you’re invested in your own success. 

“This stage is often emotional — and risky,” she adds. “Be clear about repayment expectations and keep things professional with documentation, even if it’s a close friend or family member. You don’t want to ruin your most important relationship.” 

2. Try Crowdfunding for Early Validation

Crowdfunding platforms like Kickstarter or Funded allow entrepreneurs to raise small amounts of money from a broad base of supporters — often in exchange for products, perks, or early access. 

“Crowdfunding usually isn’t the place to raise significant startup capital, but it can be a good way to test the waters,” says Cassin. “If people are willing to back your campaign, that’s proof of demand. And if they don’t, you’ve gained valuable feedback before you invest more time or money.” 

Cassin recommends campaigns that are visually compelling, well-scoped, and time limited. “And don’t forget to tell your story — that’s what moves people.” 

3. Enter a Pitch Competition

One of the most powerful ways to secure startup capital — and visibility — is through a pitch competition. MWF’s WomanUp & Pitch event is a perfect example. 

“We’ve awarded hundreds of thousands of dollars in pitch funding to women across Michigan,” says Cassin. “It’s non-dilutive capital, meaning you don’t give up ownership, and it often comes with mentorship, connections, and credibility.” 

She encourages entrepreneurs to treat pitches seriously: “Craft your story, practice relentlessly, and show your impact. Even if you don’t win, you’ve sharpened your business case.” 

4. Explore Grant Opportunities

Grants are another powerful, if competitive, way to fund early-stage business activities. While not all businesses are eligible, founders with social impact models, creative ventures, or community benefit can often find local or national grant programs. 

“We see a lot of businesses skip this because they think grants are only for nonprofits,” Cassin says. “But there are a growing number of grants for small businesses who are investing in their communities.” 

Tip: Don’t chase every grant you see. “Target the ones that align with your mission and stage,” she advises. 

5. Tap into Mission-Driven Lenders like MWF

Once you’ve got a bit of traction — even if you’re not yet ready or don’t qualify for a traditional bank loan — consider applying for a microloan through a CDFI (Community Development Financial Institution) like MWF. 

“CDFIs were created to say ‘yes’ where traditional lenders say ‘no’,” says Cassin. “We look at the whole entrepreneur, not just a credit score or how long they have been profitable.” 

Unlike traditional banks and other financial institutions, CDFIs aren’t driven solely by profit. Their mission is to expand access to capital in ways that strengthen individuals, neighborhoods, and entire communities. 

MWF’s loan programs range from $2,500 to $50,000 and are often paired with business coaching and education. “Our goal is to get you capital — and help you use it wisely. And then we want you to pay us back so we can use the funds for the next person.” 

Final Thoughts: Know Your Stage. Know Your Options. 

“The biggest mistake I see entrepreneurs make is going after the wrong kind of money at the wrong time,” Cassin says. “You don’t need a $50,000 loan if you’ve never made a sale. Start small, repay that loan, and get another larger loan. And you shouldn’t give up equity before you know what your business is worth.”     

Instead, she recommends a staged approach: “Start scrappy. Prove your model. Then layer in capital as you grow — always keeping control and sustainability in mind.”  Build a long-term relationship with your lender.   

For entrepreneurs ready to take the leap but unsure where to begin, MWF is here to help. 

“We’re not just lenders,” says Cassin. “We’re your partners. We believe in your vision, and we want to help you build your business — one smart step at a time.” 

Get the support you need to grow your business. Learn more about Michigan Women Forward’s microloans and pitch competition at miwf.org.