How To Develop A Funding Strategy for Existing Business

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How To Develop A Funding Strategy for Existing
Business
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• No shock here one of the biggest challenges for
  entrepreneurs and small business owners is
  finding the necessary funds to start - and
  ultimately grow - their businesses. If you are
  reading this, you are probably looking right now.
  (BBGV81220)
• As a social entrepreneur for more than four
  decades, as well as an angel investor and venture
  capitalist, I have personally experienced the ups
  and downs of corporate finance and learned the
  hard way what investors look for before
  committing to finance. Over the years I have
  developed, and subsequently refined, some simple
  tips to guide other entrepreneurs through the
  fundraising process at all stages of the business
  lifecycle.
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• Bootstrapping In the experimentation phase, use
  your own monetary resources, such as cash from a
  savings account or careful use of personal credit
  cards. The wise implementation of these precious
  dollars is crucial. Friends and family if you
  don't have your savings or credit cards, or yes,
  but your growing business needs additional
  funding, all is not lost. Think of inviting
  family and friends to invest in the company with
  the understanding that their money may not be
  returned. In most times, these contacts and
  family are investing in you, not your business.
  Both parties should consider this investment as
  an unconstrained grant. If the venture is
  successful, a reward for these risk takers would
  be a nice gesture.
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• Crowd funding Lets take the discussion of
  "friends and family" investments to a level or
  two. If you have not heard about crowd funding,
  you don't have to be very serious about financial
  support for your business or you've been living
  under a rock for the past six months. Crowd
  funding - allowed by the JOBS Act which will be
  launched on January 1 - allows for a larger pool
  of small investors with fewer restrictions and is
  ideal in the early stages of a business,
  especially if you don't qualify for a bank loan,
  don't you are ready for angel or venture capital
  financing (as described later in this article),
  or have no friends or family willing or able to
  provide the "no strings attached grant".
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• Angel Investors As your business reaches the
  next level of growth and you see stable income on
  the horizon, start getting closer to
  sophisticated "angel" investors if you need more
  funding. This affluent individual - or a group of
  individuals who pool their research and resources
  - provides capital to start a business, usually
  in exchange for convertible debt or equity.
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• These groups of angels can be found in most
  communities and on the Internet, with a
  description of their purpose and goals. After
  performing due diligence, these groups will
  determine if your company meets their
  requirements, and if so, they will schedule a
  meeting to collect more data. Investments can
  range in huge number of dollars. At this phase of
  the business, angels turn into very real and
  serious investors and owners with high prospect
  looking for solid results. Bank loan / venture
  capital In the later stages of a growing
  business, the now incorporated business may need
  a bank loan for various needs, including working
  capital and long-term growth. To secure this
  loan, financial institutions will require several
  years of financial information about both the
  company and the entrepreneur.

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• They want collateral to secure and secure a loan.
  To facilitate the process, interact with the
  financial institution early on in the business,
  not necessarily at the beginning for a loan, of
  course, but for a merchant account, credit cards,
  and checking account. Over time, the bank will
  become familiar with the business and the
  entrepreneur will be in a better position to seek
  out additional banking products, including loans,
  when needed.If you keep these five means of
  financing in mind and develop a business plan
  that demonstrates the value of investing in your
  business, you will significantly increase the
  chances of securing the capital you need,
  whatever stage of the business you are in.
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