Tag Archive | Investors

Funding Your Business: Some of The 4 Things To Consider

When it comes to your business the way you get things off the ground is vitally important. The business can start off as just one thought. The thought can be nurtured and once you have your plan in place the next and only step is to actually make the dream become your reality.

But of course, this can often mean that you need some sort of funding to get off the ground. I thought I would share with you some of the options you could consider. I hope it gives you the confidence and knowledge to take the next step yourself.


Using hedge funds and investment profits

Many people consider hedge funds and investments that they already have in place to fund and push their new business or business expansion forward. It can be a great way to add more exposure to your business and there is even a trading platform could be the way to ensure that you make the right choice when it comes to funding your business for the future. It could also help you to consider further investment for the future.

Finding an investor

The other option to consider would be to think about finding an investor for your business. This means that you can get exactly the cash injection into your business to kick start your plans, buy stock, create products and even expand the business in other ways such as holding stock or finding a business premises.

However, often this means if someone invests they would want to end up having a stake in the business. If this sounds fine to you then it could be a very lucrative way to get not just the investment but also the extra support.

Using loans to fund your dream

You could also consider a loan to fund your dream business venture. There are many different business loan providers out there that could help you secure the amount of funding you need.

It might be just as a loan, it could be put against your business assets as a secure way to ensure that the loan gets repaid in full. Loans are a little easier to obtain and to handle, and they also give you the full control of the business still without needing to give of the equity of your business away. However, the risk is down to you as the business owner, so it may not appeal in that way.

Your savings and hard earned cash

Finally, your savings can be a great way to fund your business. Many people do this option and feel that they have added their own value and hard earned cash. Sort of like backing their own idea. Of course, like anything, there is an element of risk to it as at the end of the day, many businesses do struggle with their first year of trading.

However, you decide to do it, funding your business is an exciting time, and taking something that formed as an idea and making it a reality is a great journey to embark on.

Entrepreneurs Are Looking Everywhere For New Money

loansTimes have been hard for entrepreneurs of late. Take Rick Stender, the founder of a bike company. He wanted to borrow money to pay for bike part imports from China so that he could build a bunch of bikes in the US and then sell them on to his customers.

Unfortunately, thanks to ongoing financial repression by big commercial banks and the government, he was unable to get credit, despite having a viable business plan and a customer base.

A random investor in the local community took pity on his business and lent him the money that he needed when the banks wouldn’t. Stender bought the parts he needed, made back the money to repay and loan, and made the investor more than $4,000 in the process.

Entrepreneurs need to realize, therefore, that the people in their local neighborhood are a great resource when it comes to setting up their own businesses. Most people should forget about banks unless Trump does something to completely overturn the existing financial order.

According to Colbeck Capital Management, one of the problems that institutional investors have is that they overweight idiosyncratic risk while they underweight systemic risk or the risk of excessive leverage.

In practice, this means that banks will quickly find fault in individual business plans and use that as an excuse not to lend money, but they’ll have no problem lapping up highly-leveraged assets, like mortgage-backed securities. It makes for a totally skewed market, and it’s not fair.

Neighbourhood Banks

Because of this unfortunate phenomenon, local communities themselves are returning to their traditional role of offering finance. Instead of putting their money in massive companies halfway around the world, many communities are recognizing the value of having successful entrepreneurs in their own areas and are adjusting their investment portfolios to match.

According to advocates of the system, everybody wins. Wealth stays in the local area, jobs are created, and investors still get a return for putting the money in.

Flexible Lending

Entrepreneurs are also benefiting from this new trend. Rick Stender’s loan wasn’t rigid, like a loan from the bank. Instead, it was flexible because he was able to constantly negotiate with the person making the loan. Entrepreneurs will frequently run into trouble, as was the case for Stender. But even when things were tight, his creditor allowed him to go without having to pay interest for a couple of months, because he wanted to see his business succeed.

According to software engineer, Sallie Calhoun, local investing is key to the success of businesses in the local area. She says that it offers greater flexibility and it makes it more likely that the loan will eventually be repaid.

You’re much less likely to walk away from the person you’re borrowing from if they’re a valued member of your local community. In turn, this has the effect of lowering interest rates overall, simply because it is less risky to lend to a person you know.




Tech Is Making Real Estate Investing Uncertain, And Investors Don’t Have A Clue

File:Interior View of the Additive Manufacturing Integrated Energy (Amie) 3D-Printed House.jpg

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At its root, real estate investing works something like this: an investor takes a pot of money, invests it in a building, and then hopes that the building will go up in value, either so they can sell it for a higher price later on or charge a higher rent. All of the derivatives in the housing market ultimately come back to this basic equation. If the cost of housing goes up, the derivatives go up too, and investors win.

But there’s a problem. Despite the best efforts of governments and special interests to restrict the building of new homes to bump up house prices, technology is forcing the cost of housing down, and its impact is going to be profound. Lower cost housing could potentially mean that investors lose out, especially if they think that house prices can only rise from here on in.

Here are some examples of the technology transforming the real estate sector, and how investors don’t have a clue.

3D Printed Buildings

Eric Schmidt, president of Google and technologist recently spoke at a forum in California on technology. He pointed out that 3D printing is a lot more advanced than most people realize, and soon it’ll be printing out houses. A regular house, he said, takes about 18 months to construct, requires an enormous amount of manpower, and is damaging to the environment.

But a house built using 3D printing can be printed out in a day – and to a much higher build quality to boot. Schmidt pointed out that these building methods would reduce the price of housing close to the cost of the raw materials, fundamentally transforming the construction sector in ways we can’t really imagine.

Regular real estate investors should be worried. When this technology really gets going – and it will – they will quickly find the price of their assets falling, all thanks to the incredibly cheap way in which houses can be constructed.

Because 3D printed houses will be of higher quality than regular homes, they’ll act as a pull factor in the market, turning buyers off lower-quality “old-build” homes. As prices go down, investors will suffer.Some advice? Get on the 3D printing train early.

Home Made In Factories

Since 2011, the number of manufactured homes has been on the rise. Far from seeing mobile homes as substandard, people now view them in a far more favorable light. Like the 3D printed homes of tomorrow, they’re customizable and higher-quality than most currently-available brick-and-mortar builds.

Investors need to watch out. Again, we’re in a trend here: more and more people are opting for mobile homes that keep the elements out and provide the space they want at a much lower price. Rather than investing in regular construction companies, there’s an argument to be made that investing in home manufacturing companies is the way to go.

After all, they are the ones with the most experience of the factory environment, and they are the people who will most likely push technology forward in the future. It’s far easier to integrate a home into a smart city in a factory than it is to do using traditional building methods.

Essential Questions To Ask Before You Launch Your Business

business-launchMany of us dream of being our own boss. There are many advantages that come with being an entrepreneur. However, there are risks involved.

Running a company isn’t easy. It requires hard work, determination, and business acumen. Many people start up their own business, but few achieve success.

If you’re preparing to launch, here are some questions to ask first.


Who is the target market?

There’s no point in trying to sell a product or service if you’ve got no idea who is going to buy it. To make a business work, you need to make money, and this means that you need clients. Before you take anything to market, make sure you’ve taken your target market into consideration. This should be a vital element of planning everything from the price points, branding to the packaging design. If you’ve got a good idea of who you’re aiming to target, you should also be able to produce a much more effective marketing campaign.

Is the product tried and tested?

No product should go to the market without rigorous testing. The last thing you want is to generate a load of orders only to receive a host of complaints. You won’t make money if you’re offering refunds all the time. It’s also essential to test out your product range before you pitch to buyers and investors. Make sure you’re familiar with how they work and what they do. There’s nothing worse than digging up a product only to freeze on stage when you try and show it off.

Are you prepared for the day to day running of the business?

Setting up a business isn’t just about designing an amazing product and attending launch events. You also need to take care of the day to day running. Have you got staff rotas and payrolls sorted? Are your business premises insured and secured? Have you got software in place to keep track of your accounts?

Of course, the tasks you take on will vary according to the nature of the business. Often, in this day and age, you can use innovative software to manage systems for you. Before you employ software programs, look into test case management tools. Test case programs enable you to run software tests to detect bugs and ensure that they tools are relevant to your company.

Do you have facts and figures on hand?

Success in business comes down to numbers. Before you launch any type of business, you need to be familiar with the facts and figures. This is not just important when it comes to trying to get investors on board. It’s also essential that you know how to make this business work. How many units do you need to sell per year at what price? If you have a good grasp of the figures, this will stand you in good stead.

Bottom line;

Being an entrepreneur is a dream for many people. If you’re working on a new business idea, make sure you can answer the essential questions before you take the plunge. If you can’t, take your time to find solutions. It’s best to get sorted beforehand than to rush in and fall at the first few hurdles.