According to the SBA, entrepreneurs use personal savings more than any other source of start-up financing.
Crowdfunding is a new source of capital for founders, but there's a big difference between equity fundraising online, rewards-based crowdfunding and peer-to-peer lending.
Fledgling businesses rarely command seed or venture funding right out of the gate. But they still need cash to get started.
Founders with money of their own use personal savings to start a business. Those who come from wealth - or have great connections - can rely on family or friends for a little money or perhaps free rent and Wi-Fi. According to the Small Business Administration, entrepreneurs rely on personal savings more than any other source of capital to fund their businesses.
Many founders have a day job and use their income to build a product and start a company. Two famous examples: Steve Chen was working at Facebook when he first started tinkering on YouTube, and Markus Persson was at while building the earliest version of Minecraft.
Airbnb's Brian Chesky admitted to students at Stanford University that he and co-founder Joe Gebbia racked up tens of thousands of dollars in credit card debt to keep the lights on in their early days.