When you need to find money, there are many options to explore: many types of investors and business funding sources. What can you do to raise capital?
Well, of course, first of all you need to market your business proposal to the investment community. A good 'investors database' is essential here to find money. You can have the best deal in the world, if the word does not get out, there won't be any investment coming to you. You have to let the world know what you have. You have to bring it to the world. And you need to show the best possible presentation in the most efficient way.
Communicating to sell a product or a service is called 'advertising', you are marketing what you have, you are making your search to an investment public. Finding the best way to reach the best quality public is what you need when looking for funding. You can read our page on "Marketing your Investment Proposal" here.
We are convinced that our investors database is of the highest quality. At the same time we know that the way we offer our database for use is (one of) the least expensive way(s) to reach investors and find money.
When you advertise you pay a fee for reaching your public, just like in newspaper advertising. Advertising with our email campaign to our investors database is like advertising in a high level corporate financial magazine that is being read by executives and investors. However, we think we do better because we address the investor personally, and over the years we have built a relationship of tolerance and interest. Tolerance for our messages and interest because of the quality of the deals that we bring to the table.
Compared to a high level corporate magazine our fees are only a fraction of those. We have several ways for our clients to participate in our email campaigns. From a very low entry level to our more sophisticated services of 'Personal Introductions to Investors'. We do not 'screen' or pre-select' who can advertise with us. We offer several ways to enhance the offers though. We do not guarantee that you will find money either. Our email campaigns are strictly forms of 'elite' advertising. Please check our Services for Start Ups or our Later Stage services.
How to assess your business?
Here is a small overview to bring some clarity to the world of business financing.
Pre-revenue companies have zero revenues. They are in the 'seed' stage or 'startup' stage.
Small companies or startup companies have revenues from zero to $10 million.
Middle market companies have revenues from $10 million up to $1billion.
Large or big companies have revenues over $1 billion.
To find money, you must review all of your options and look at all of the pros and cons.
Types of funding
ANGEL INVESTORS and PRIVATE EQUITY INVESTORS
What is the main difference between Angel Investors and Venture Capital Investors?
'Angel Investors' are private investors. They invest their own private money.
'VC investors' are institutional investors. They invest money from companies or funds.
Angel investors jump in at the 'seed stage' or 'start-up', earlier than the VC's. They
recognize that the idea/project may be successful in the long run and
they get in early. They do take a certain amount of
shares or 'equity' in the company. They become your partners and will watch what you do with their money. Angel investors invest anywhere from $50,000 (even less in some cases) and $1million. Find money from angel investors here.
Venture Capital companies invest in 'start-ups': i.e. companies with a great concept, excellent management, a good business model, and strategies that bring growth and profit in the foreseeable future. They will be very involved in the management of your company and will bring a lot of expertise and professionalism. Most VC companies will not invest under $5million.
In order to find the right investors, and 'find money', you have to market your investment proposal (your idea or company).
JUST DON'T SIT BACK AND WAIT UNTIL THE INVESTORS SHOW UP AT YOUR DOORSTEP.
You have to convince the investors that your deal is really solid and profitable. Why? Well, there are thousands of people who have great ideas and who write a business plan to find money. You have to prove, with your business plan and financial projections (opens new window), that your great idea is viable, special, safe, and a lot more than that. It needs to be really exciting to catch an investor's eye.
Find the best ways to contact Angel Investors: 'Angel Investing Formula' (new window will open),
is a product created to get the information, the techniques,
all of the angel investor sources, all of the tips, do's and 'don't's,
lined up for action. Learn the proven step-by-step formula for finding, pitching and securing funding from individual or "angel" investors. Find money with the ones who have raised over $2,5 Billion already.
Don't make any mistakes legally; optimize your
presentations or direct communications with investors; learn how to
close the deal, how to negotiate, how to protect your intellectual
property, and much more. You need to raise money, not spend money, the
cost of this product is surprisingly low. Check it out here
Find the best ways to contact VC companies and get them to look for you with 'Venture Capital Pitch Formula'.
The "old-school" way of raising venture capital is DEAD! VC Pitch Formula shows you the RIGHT way to raise millions in venture capital. Check it out here(new window)
Your presentation needs to be flawless. Your management capabilities need to become obvious. Your numbers need to be real, excellent, and at the same time, fabulous.
Imagine yourself to be the investor. You have done great business for many years. You have put aside some investing money and you are looking for opportunities. Would you give money to a total stranger? NO! Would you give money to someone with a great idea but no business sense? NO! You want to be paid handsomely for investing risk money. You want to know with whom you are dealing with. You absolutely want to know what your chances are.
Furthermore, being the investor, you want part ownership of the company. You will also contribute to the success of the company. You will use your business savvy and your business connections for this company to succeed.
Once the angel investor has decided to go with your project, you will have a great ally. But also, you will have to report to him or her. Your communications will be intense. This investor is not your bank who gives you money and then checks on you once in a while. This is a money 'marriage'.
Next stage in the process, next round of funding, you may end up with a venture capital company. Whatever you had to do or went through with the angel investor becomes even more...: more due diligence, more negotiations, more involvement.
Conclusion: Communication, records, projections, presentations, all have to be of the highest quality if you really intend to find money.
Take a look at some of our articles to get a sense of the challenges and pitfalls that may be waiting for you. Obvious mistakes can be avoided easily. Make sure you don't make these: "16 reasons why your business proposals won't get read".
And keep in mind the points made in this article: "10 tips for scoring big with your business plan".
Obviously grant money is the least expensive option. Check if your business or project qualifies for federal grants or government grants for small business. There are massive amounts of new business grants: from small business grants, to minority small business grants, company grants, free business grants, community grants, etc.
Our advice and experience with grants is that you need to follow the instructions of the grantors in minute detail. Read their instructions several times and do not deviate from what they want and expect from you. When applying for business grants, the criteria that are set are obligatory. If you don't meet these criteria, your grant application will not be accepted. It will not be read.
Also do realize that grants are like a
contest in which the best applications are selected and very often a
selection committee decides who gets the available grants. You have to
'sell' your project to real people.
What does that tell you? It means that you need to make the best presentation. You have to write clear, compelling and concise content (the three "C's"). The way you present your business proposal is essential.
Check out our Guide to Raising Capital from Grants. This will guide you through the process of winning grants to fund your business. Check here (new window will open)
Bank loans and SBA loans
Applying for a loan with the bank may be your best bet. You will need good credit and build a relationship with your bank, and of course, make a good presentation.
Our Step by Step Guide to Raising Capital From Banks and SBA Lenders will teach you how to quickly and easily get the right SBA and/or bank loan to fund your new venture. Find out here. (new window will open)
In order to qualify for SBA (Small Business Administration) loans, check the SBA website. It is a rigorous process of registering, dealing with government administrations and going through the process of qualifying, counseling, and of course, communicating. If you do this well, you may find the exact help that you need to get your business up and running.
Find more information at http://www.sba.gov/
Don't forget: your presentations will make the difference. Our Step by Step Guide to Raising Capital From Banks and SBA Lenders will teach you how to quickly and easily get the right SBA and/or bank loan to fund your new venture. Find out here (new window will open)
Alternative Private Sources of Funding
Check out these curated articles on Scoop.it on Funding related topics: