Most owners of start-up businesses dream about drawing venture capital to their company and expand the business exponentially in a short period of time. But when is a company ready for venture capital? Knowing the answer would make it a lot more efficient for a small business owner to reach venture capitalists and get the funding. Read the rest of this article
Tag: Venture Capital
Venture capital has been a popular way of funding small businesses, especially start-ups since the early 1990s. Most small business owners today rely on venture capital from private investors when executing business expansion, because it is usually not easy for small Read the rest of this article
What makes the perfect investment pitch? In your business presentation, you may have well considered every possible scenario and put all elements into the business pitch, but often what makes it perfect are the little details.
This can be thought as entirely irrelevant to the bus Read the rest of this article
Many investors started to think about capital investment in small to medium enterprises than in the stock market. The stock market has been sliding worldwide all summer long this year, and does not seem to be recovering soon due to some major fiscal issues in the US and Europe. And the bond market does not provide a satisfactory yield either. With the US 10-year bond yield below 2% today, there is very little room for price increase and not much incentives for holding the bond to maturity.
Capital investment has higher potential
With that said, capital investments into smaller business have higher potential returns. That’s because although we are having fiscal and financial problems across the world. The general economic condition is comparatively better than previous years. Most small businesses are very lightly affected by the financial markets. However, small businesses are in general more risky than large enterprises, and it is important that an investor makes the right choice.
Choose an industry that you are familiar with
As reported by many analysts, it is very reasonable to believe that some industries, such as health care, are going to expand faster than others. But that by no means tells us all companies in that industry are going to enjoy the same growth. If you are investing in an industry that you are not entirely familiar with, chances are that you cannot practice precise analysis of the company value. Therefore as an investor, one should always look at companies in industries that he understands.
Shop around before making a decision
When it comes to capital investment, each small business is unique. All attributes, such as company value, director’s personality, marketing dedication, etc. are different for each of them. Therefore, it is essential to view more company profiles before setting a target of the type of company you want to put your money in. And that is often easily said than done, because there does not exist a market for small businesses to display themselves side by side for easy comparison. But there are alternatives ways such as a business pitch events. Currently there are a series of small business investment events held at pitchyourbusiness.ca. If you are considering capital investment, contact the Winflow Financial Group today and see what you can take part in businesses with high growth potential.
Many famous newly developed companies in the past decade started with venture capital. As a small business owner, one may ask, do I need venture capital for my business?
The answer is not definite.The following two points are what one will need to consider in order to answer such a question.
Get your business ready for incoming venture capital
As we mentioned previously, small business owners seeking private funding should first prepare their businesses for the business pitch. This includes a clean financial report, good revenue numbers, strong yet reasonable forecast, and the acquisition of potential intercultural properties such as patents and trademarks.
Know where to spend the venture capital and how much growth you will get from it.
This is the part that most people omit. In our experience arranging meetings for small business owners to meet venture capitalists, the investors often ask the question: what do you need my money for? And chances are that the small business owners cannot provide a satisfactory answer. That’s because many have not realized what the venture capital can do for their business. Venture capital, if used correctly, works a lot better than just an addition of working cash flow. As an entrepreneur who seeks venture capital for growth, you should always think of expansion using the investment. Exponential growth is what venture capitalist are really aiming with their money. And it should be the same reason why you need venture capital.
With the above two questions answered, you are not ready to seek venture capital. Check pitchyourbusiness.ca for a chance to present your business to the professional venture capitalists today.
How to be an entrepreneur? How to be a successful entrepreneur? These basic yet difficult questions make many hesitate before starting their own businesses.
A right business idea gets you on the right track
You may feel that you are born to be an entrepreneur and have business ideas flash in your mind everyday. Read the rest of this article
Many new business owners ask whether they should choose an angel investor or venture capital financing. There are a few factors that need to be taken into account, but fortunately there’s usually a clear answer to what a new business needs.
- It’s important to have a business plan that highlights the capital required to start your business. With this you can work out the investor you need. Angel investors will only finance sums of money under $3 to 5 million, whereas venture capital funding will offer over $5 million.
- Your business plan will also need to display the number of years before an option of exiting the deal. If it’s a small term plan then your best option will be angel investor who will allow an exit after 2 to 5 years. Venture capital will lock you in for over 10 years.
- There is also a company value that needs to be met at the time of a contract exit. Venture capital funding will far exceed the angel investors and depending on the contract, there may be a $50 million difference.
- The larger sums of money invested will mean more control of your business. If you don’t plan to relinquish control of decisions then the angel investors will be a better option. They may make adjustments, but with venture capital funding investing more they will almost always require full control.
For more information on starting a new business contact Winflow Financial Group.