Are you struggling to find finance for your new business, but you can’t see a way of getting the finance well then you haven’t heard of Business Angels and Venture Capitalists have you!
You may have looked into bank loans, asked friends and family for a loan or looked into getting a few credit cards to pay for you to set your business up. If these have all come up unsuccessful or not possible then why not look into private investors like Business Angels or Venture Capitalists.
Business Angels are usually from an entrepreneurial background who knows what you’re going through and therefore can offer invaluable advice and the finance you require if your business catches their eye and you have a well planned and thorough business plan in place for them to see. A business plan will show them what your goals and objectives are for now and in a few years, what will your business do offer a service or sell a product, who your target audience will be children, adults, teenagers or the elderly or a mixture. It will also show the prices and how much money you require to start the business up and also the finance you require for things such as a property, computers, rent, other equipment and also staff wages if necessary.
Business Angels usually offer around £10,000 to £75,000 in finance, depending on what you require as well as how well they think your business will do. If they think your business is a success from the start there more likely to offer you more in the way of finance, as whatever they put into your business they will get back and more. The more successful your business is the more money they are likely to get back. Business Angels may work in an Angel Network or Angel Syndicate, this means angels will group together and this way they can offer you more in the way of finance, from £75,000 to £150,000.
Venture Capitalists are slightly different in the way there are usually from an entrepreneurial background like business angels and can offer around the same finance from £10,000 to £75,000, but instead of mainly taking a backseat on day to day decisions and management decisions venture capitalists like to have a director’s role within the company or be part of the management. Some venture capitalists like to take a hands on approach with their investment and be apart of the day to day running and management decisions, and they usually take a percentage share of the business to begin with.
If you’re looking to raise finance for your new business venture whatever it may be and you don’t want to pay high interest rates from banks and other sources of finance and your family and friends don’t have the financial backing you’re looking for, Business Angels and Venture Capitalists might be your answer. They will be able to offer you the finance you require at the time you require it if you present them with a thorough business plan and shows your drive and enthusiasm for your business to take off.
By: Jene Pedder
Archive for July, 2009
The fact that the US has 3.9 million homes for sale and most of them coming from foreclosures means that newer, more efficient Home Loans must be offered. The truth is, getting a home loan is easier now than before the Real Estate boom, you just need to look in the right place. In the following article I will tell you where to look for the lowest interest rates, and well as what the banks will be looking for when qualifying you.
In order to resolve some mysticism, and shed light on this shady subject I inform my clients that they should specifically ask for Government Loans such as FHA or VA (Federal Housing Administration, Veterans Administration.) I say this because the government has poured money into these departments and are eager to create revenue by lending it out in Home Loans. For instance, FHA offers First Time Home Buyer Programs, Loans that allow 3 or more borrowers, Little or No Money Down Programs, and offer the lowest Interest Rates in the country backed by the Federal Government. FHA is a great place to look for Financing as they are rewriting the book on Stable and Sustainable financing of Homes now and for the future. You will stay ahead of the curve by empowering yourself with knowledge of specific programs, and the constant changes that are made on Government Loans. So now that you know where to look, what will determine whether you qualify or not?
The first place to start is getting with a quality professional Loan Officer, and or Realtor that specializes in Government Loans. What they will tell you is that the banks are looking for Credit, Capacity to pay back, and Collateral such 401k, or cash on hand. I suggest using a local Loan Officer to help you establish your credit scores, procure paperwork, and calculate payments. Since most Loan officers work on commission only, they are free of charge to start, and are usually very savvy and eager professionals. (For a list of Loan Officers I work with and recommend, please contact me) These 3 C’s of Financing are the most widely and acceptable terms to Finance Professionals and speaking the same language of professionals is the best way to make sure you gather all the proper facts.
So now that you know where, and what to look for, get out there and see what is for sale. I bet you will be amazed by the price, and it may even be cheaper than the rent you currently paying. Make sure you consult a professional, speak the same language, and ask for Government backed Loans.
By: Jesse Saenz
Securing funding for a new venture has always been a challenge for business owners. Ensuring that the company has the proper level of financing is one of the most critical tasks. However, finding financing for a new venture can be very hard. On one side, you can try and secure venture or angel funding. This type of funding will require that you give up a portion of your equity/ownership in the business. It means you will end up with additional partners – or managers – in your company.
Another route consists of trying to get conventional business financing, such as a business loan. However, few startups can get business loans because most financial institutions require that the company have a track record of successful operations and substantial assets. Since most startups don’t have long track records and have few assets, few can meet these requirements.
Cash flow can even be more problematic for companies that sell to other businesses or to government agencies. This is because they usually have to invoice when they deliver the goods, and then wait 30 to 60 days to get paid. Growing a business while waiting a month or two to get paid can be hard to do. Many times growth is delayed and opportunities are passed. This is an alternative however.
What would happen if you could get your invoices paid in 1 or 2 business days and essentially ran a cash business? Would you still need financing? Would you still turn away opportunities? This can be accomplished by using a neat financial trick – factoring your invoices.
Invoice factoring enables you to get a substantial portion of your invoices paid immediately, providing you with the funds you need to pay suppliers and employees. More important, you get the funds you need to keep up with your growing orders. If you have a business that is firing on all cylinders, factoring accounts receivables can really help fuel your company’s growth.
Factoring offers a simple proposition. A finance company, called a factoring company, advances you up to 80% of the net value of your invoices. You get the immediate funds while the factoring company waits to get paid. Once they get paid, you get the remaining 20%, less the factoring fee.
One of the more important features of factoring receivables is that factoring companies biggest criteria (though not the only one) for providing financing is the quality of your clients. This means that if you do business with large credit worthy companies you stand a good chance of qualifying for financing. Furthermore, invoice factoring can be setup quickly. Usually it takes a week or two to set up an account, and after that, funding can be done daily.
Although factoring financing has been around for a long time, it has been gaining traction and notoriety recently as a solution for growing companies. It offers great flexibility, as your financing is determined by your sales and the quality of your clients. This makes it a great solution for companies whose biggest asset is the clients that they do business with.
By: Marco Terry