Pharma Companies Taking a Second Look at Startups in 2012

ByJeremy B Thompson

Expert Author Jeremy B Thompson

Pharma companies are taking a second look at startups in 2012. These companies are known to be a driving force in the research and development of new medications. This is currently a lucrative area, and many of these startups provide a lot of innovation in this field. These new companies are able to work in a number of ways that are not available to many of the largest firms. They often have a greater freedom to develop their products.

Many of the innovations that occur in the pharmaceutical industry are brought about by small startup companies. A pharma company often has to struggle to get the capital that is essential to their work. There are a number of ways that they can do this, and many rely on investments from venture capitalists. This capital provides a number of things to these startup companies.

A pharma company needs resources to continue its work in the innovation and testing of new medications. They often have incredibly high bills, and most of these startups require independent capital to help them meet their needs. Venture capitalists often provide the resources that these small startups need. This is also a great area for investors to realize an excellent return on their capital.

2012 is sure to bring about many new things to pharma companies. Most analysts are aware of the earning potentials that are available in this field. Startups are an important player in this game, and their work is essential to the development of new medications.

Many chemists often have a great idea, and they decide to pursue this idea with the startup of their own pharma company. This can lead to many innovations. These startups often focus on the kernel of an idea. They can then put all of their resources behind the product they're developing. Many of the larger companies don't have the economic ability to commit themselves in this way. They're often more focused on other issues.

Pharma companies are taking a second look at startups in 2012. These small firms are known for bringing innovation to the development of new medications. Many of the people who work at these startups are inextricably linked to the success of their products. They often rely on the investments that can be provided by venture capitalists. Since they often have limited resources, it is essential for them to solicit capital from a number of sources. This capital plays a huge role in the success of these startups.

Pharma companies are taking a second look at biotech startups this year; learn about opportunities in this exciting space on our website.

The Latest Pharma News: Research Shows Increasing Interest in Startups

ByJeremy B Thompson

Expert Author Jeremy B Thompson

The pharmaceutical industry has been continuously improving and evolving over time with the relative advancements and breakthroughs in the technological sphere. And with the crucial role that the pharmaceutical industry plays in society, these improvements may yield significant benefits that can result in the further betterment of the quality of life of a person. With this important function, one should make it a point to achieve awareness and knowledge with regards to the latest pharma news in order to attain a better understanding of what the subject is predicting or entailing in terms of the quality of health and well-being of individuals in the future.

In the latest news in the world of pharmaceutical science, recent studies and researches depicts an increase in the interest and start-up of private companies and businesses that are working on new and better pharmaceutical products. This particular pharma market research is directed at biotech growth and development as well as the investors who wish to fund these private companies for initiation of new projects. Biotech has various challenging features for venture investors. One is that it takes a very long time to market the end product or the result. In fact, the typical period of time that investors would have to wait prior marketing and profiting from their investments range around 10 to 15 years. Investors should also realize that there are very high degrees of risk, less than 1% of drug advocates will make it to the marketing stage. Also, great amounts of capital are required to continuously move the technology forward and ensure its progress until completion of the project. With this, you, as an investor, will have to continuously invest on the project in order to yield the desired results. Lastly, few successful companies typically have a large growth affiliate or an acquirer.

So why is the rate for interested investors on biotech start-ups as stated by this pharma market research? One major element that may be contributing to this increasing rate is the low business costs that are required to gain a stock or share. Some investments require a hefty amount before you can invest on it. Furthermore, most investment options are reliable and economically-priced in terms of the utilities provided. To keep track about this particular pharma news, you can subscribe in various sites that can provide you with all the breaking news and updates with regards to the world of pharmaceutical development.

If you're interested in the latest pharma news, be sure to check out the articles on our website.

For Investors, Return Follows The Perception Of Risk

ByDavid Z Reynolds

Expert Author David Z Reynolds

In Brief:

You're keen to know the Investor's terms for a loan. Why they can't give you specifics, only general guidelines for interest rates, time period and conditions or other 'terms'. It's all about their perception of risk.

You're keen to get a commitment from an investor so you can create the great business you have dreamed of. Often the first thing that entrepreneurs want to know is the 'terms' of the investor's commitment: What interest rate will they charge?; How many years to pay back the loan?; and Can I have an interest free period at the start, so that I can take the pressure off my business' cash flow?

A great many entrepreneurs fall into this trap and get frustrated when they can't get a commitment from an investor. What is the reason for this frustration? Genuine investors cannot legally commit themselves to 'Terms', because that is only possible after their due diligence.

Worse still, they may be duped by unscrupulous people who offer them a 'Terms Sheet' very early in the process. The 'Terms Sheet can be the 'bait' used to catch the inexperienced entrepreneur into committing themselves to a scam that is pretending to be an investor. Don't fall into the trap!

However, you may be given a Letter of Intent by genuine investors. That has lots of legal clauses that give the investor an escape route from the commitment. The genuine investor MUST protect themselves with a thorough due diligence. This leads to the investor's risk assessment. The risk assessment dictates the terms you may be offered. The reason is that when it comes to investment it is universally stated that "return follows risk". Which is to say that the higher the rate of return [interest] the higher the risk of the investment.

When you're looking to borrow someone else's money to build your business, you are inviting the lender or investor to rate your business as a "risk" - because the interest rate and terms they want in return for letting you use their money relates to their perception of risk in placing their hard earned cash in your venture.

Whether you like it or not, when you ask someone to invest in your great business you are inviting their judgement of you and your business. This is unavoidable. The investor cannot assess the risk that your business represents until they have completed their due diligence. This critical judgement cannot be done one moment sooner. The reason is that the purpose of due diligence is to discover all the risks, and proof of protection against risks that has been built into the venture.

So be patient. An International Investor can probably give you some guidance about terms, but not a 'terms sheet' until after they have discovered the risk, after your plans and arrangements for the business have been scrutinised by due diligence.

David Z Reynolds is a senior Financing consultant with many years of experience. He has conducted due diligence for Investors in Africa, Asia and Australia. Together with his wife Amanda, he operates GPC Business Plans. They develop business plans that are 'Investor Focused', custom designed to meet, or exceed the investor's due diligence standards. They offer a FREE website with articles that explain many issues that are pertinent to entrepreneurs. The articles explain terms and processes involved in entrepreneurship and developing new businesses. They may be found at

Alternative Business Financing

, factoring, invoice factoring"; // -->Marco TerryPlatinum Quality Author PlatinumAuthor|  255 Articles

Joined: April 3, 2005United StatesWas this article helpful?00342232ByMarco Terry

Expert Author Marco Terry

Finding the right solution to finance a business has always been a challenge for owners. Most are only aware of conventional products, such as business loans or lines of credit, that are offered by financial institutions. While this products can work very well, they are usually offered by financial institutions that have conservative lending standards which can make the inaccessible.

Not too long ago, getting a business loan was relatively easy, especially if the business owner had a home that could be used as collateral. Nowadays, business loans are much harder to get. Financial institutions will ask for two to three years worth of financial statements and review them very carefully. Likewise, they will only get involved in lending transactions if the business has substantial collateral and if the owner has a significant net worth. These criteria all but rule out small business. Because of this, solutions have been on the rise.

Most small companies that look for business financing do so because they have cash flow problems. Usually these happen because the company has to give 30 to 60 day payment terms to their customers but has expenses that need to be paid quickly. In effect, they can't afford to wait up to 60 days to get paid. One obvious way to fix this problem is to use a line of credit to cover expenses while waiting to get paid. But if a line of credit is not an option, invoice factoring may be the right alternative solution.

Factoring is a form of business financing that accelerates your cash flow due from slow paying customers. It works by using a financial intermediary, called a factoring company, that advances funds against your slow paying invoices. The factoring company holds the invoices as collateral, while your company gets a cash infusion that can be used to meet your current business expenses. The transaction is settled once your customers pay the invoices, though many companies establish revolving factoring lines that can be used on a regular basis.

Most factoring transactions are structured so that invoices are funded in two stages. The initial advance is provided as soon as the work is completed and your customer is invoiced. Most initial advances are for 80% of the invoice, but this can vary based on certain conditions. The second advance is provided once the invoice is paid in full and covers the remaining 20%, less the factoring fee.

Factoring fees usually vary based on a few parameters such as the creditworthiness of your customers, the quality of your invoices, how long it takes for your customers to pay and the size of the factoring line. Generally the factoring fee will be based on a percentage of the invoice.

One of the main advantages of invoice factoring is that it's easier to obtain than most conventional financing. The most important criteria to qualify is the credit strength of the companies that will pay your invoices - this represents the collateral for the factoring company. Aside from that, your invoices need to be free and clear of any legal or tax encumbrances. Lawsuits, judgments and tax problems may hinder your company's ability to get factoring financing. Most factoring companies will check this information during their due diligence process.

The biggest benefit from factoring is its flexibility. Most factoring lines are not based on fixed amount, but rather are tied to your sales. This means that the invoice factoring line can grow with your business, provided that your sales to are to credit worthy companies. This makes factoring an ideal solution for small and medium sized companies that have good potential that is being hindered by cash flow problems.

About Commercial Capital LLC

Are you looking for factoring? We are a leading factoring company and can provide you with a competitive invoice factoring quote. For information, please visit our website or call (877) 300 3258

How Can I Invest in a Movie and Make Money With a Movie?

BySteven Razzon

Expert Author Steven Razzon

You may have heard that movie investments, especially low budget movie investments, can be very lucrative. This can be true, and you may be excited about investing in a movie, but not know how to find a movie project to invest in. You may also be wondering about what to look for in a low budget movie project, and what to watch out for. This article will explain how to find a movie project to invest in, and how to determine if it has a good chance of being a successful movie that will produce a good profit.

In your search for a movie project to invest in, you can simply search the internet using the key words "how to invest in a movie" and you will get a good start in your search. You will find a myriad of different articles, relating to this topic and associated topics. If you keep searching, you will find some movie projects with budgets that are within the realm of what you want to invest, and which have a story line that appeals to you. The term small budget in this article means movies costing under $300,000.

You will also find investment opportunities for bigger budget movies, where someone sets up a company which is funded by a pool of small investors. The budget for the movie may be 10 to 50 million dollars, and you can invest only $50,000 to $100,000 if you wish.

It is most important to know that movies with budgets under $300,000 actually have a chance of earning a much higher return than budgets costing in the multi millions. For instance, with a budget of 30 million dollars, the movie will most likely have to get a theatrical release to make a profit. Because of the limited number of movie screens available, getting a theatrical release is difficult, with strong competition from large Hollywood studios for those limited screens. On the other hand, a movie that costs $300,000, can break even if it is shown on TV only once. With TV networks worldwide on the constant lookout for new movies to broadcast, it can be relatively easy to double or triple your investment with relative ease. Some movies costing under $300,000 have made over a hundred million dollars. This type of return is rare of course, but it is possible.

For any movie to make money, the story must be interesting and captivating, and have something unique and special about it. Movies that are based on a true story have a higher chance of success. And here is smoothing very important to know. A good story is more important than big name stars, or special effects. You can verify this by checking the movie listings on TV. You will see movies you never heard of, yet they have big name stars. It is because they were actually box office flops. Yes, they are good enough to get on TV, but they may never break even.

A low budget movie on the other hand, can make good money if it is only shown on TV. If it turns out to be exceptional, it can get a theatrical release, and make really big money.

One thing to look for in a low budget movie investment, is to see if the writer/director is putting their own money into it. The writer/director should have some past successes, such as some awards, and TV sales, even if they are just with short films. Most low budget movies are made by writer/directors who are moving up from short films to feature films. If they have already made some feature films, they are also likely to now be working on bigger budget films. The key is to find someone who looks to be a rising star, and to capitalize on their strong commitment to their movie.

I am making a feature length movie, and I am looking for investors. The budget is only $100,000, and you can invest as little as $5000. I am investing my own money in the movie. I have won some awards and sold my short films to TV. I have what may be the most complete movie investment website ever made, with all the details, including details that some people try to hide. Just looking at my website is an education in itself, and if you look, you will be entertained as well.

Why the budget can be reduced so much is explained on the website. The movie is based on a true story.

The Realities of the Startup and a Kiosk Based Business Plan

ByLance Winslow

Expert Author Lance Winslow

Not long ago, an entrepreneur told me of a great new kiosk business model, and it sounded fabulous, however having and innovative idea, and a nice business plan are much different than actually making it happen. Okay so, let's talk, because the entrepreneur then asked; where is the best place to get the startup capital and funding for such a new business of this type?

He also suggested that he would not need all that much, perhaps enough to get just a few machines going to get it started and prove the concept. Previously, he'd also indicated that the market for such a kiosk business is vast and worth billions in revenue per year. Indeed, at build out, it could be more like 10s of billions. Well, what say you Mr. Start-up Guru, he asked?

Well, here is what I have to say;

Yes, that's what all us entrepreneurs say isn't? We sit on a billion dollar industry and we don't need much to start. But in reality, yes, you do, and don't count pre-hatched chickens my friend.

Further, actually, you'd need to roll this out something like this awfully fast, so, wouldn't you need a minimum of 5 units of your own making money in a regional chain, plus 20-demo units, and a Blitz Marketing team to ram this into the market? Additionally, you'd need to have a team of 2-3 kick-ass, take no prisoners, 17-hour a day, need for speed, entrepreneurial types. Then a several high-tech wizards, and friends in the right places to make sure these kiosks stay synced up with all their other components.

Okay so, let's put this into perspective and a reality check:

1. So, let's say these devices cost $25,000 to $25,000 to make the kiosk with graphics, and you need 25 = $625,000
2. Plus, your sales team = $140,000 year + $300K in commissions
3. Office ($50K) computers ($40K), Home-office set ups etc. = $130K (even on the mega cheap $50K)
4. Executives for one year, provided they are not lazy schmucks wanting a cool salary and to look good, I mean kick-ass start-up types with skin in the game. $200,000


$1.265 M

Now any smart entrepreneur will tell you, that you also need to triple the time to get it going and double the start-up funds, even if the business starts making decent money. So, your 1.265 million dollars is now $2.53 million, and your project instead of 12-18 months is now into 2 to 4 years, before it pays back the money it started with and a decent ROI, or is even viably in the running for an IPO or sale.

Now then if you had a couple of machines and a nice business plan then there are people and corporations, maybe even your initial corporate partners parked on lots of cash, ready to invest, but you'd need to have a machine in place, and a solid plan. And then you'd have to roll the thing out, as if the Mayans were right, and rocket it into the market place, and accelerate, growing a light speed.

Not many people can do that, if you are one of them, you'd have to prove it, or have a track record - the money then becomes very easy to get. Now then, if you move to slow or roll this out like a tortoise, then someone will take your idea run with it, be done with it and do so, before you get out of the gate. In fact, I bet someone somewhere has already started, the only difference now is the jockey, not the horse, right?

So, Mr. Entrepreneur, how much do you really need to get this done, not just to have a pretty science project? Serious, this is where the rubber meets the road, and BS walks right? Oh, and where is your business plan. Please consider all this and think on it - seriously, really think on it.

Lance Winslow has launched a new provocative series of eBooks on Business. Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank;

I Only Need a Little Money to Start - How About Crowd Source Funding?

ByLance Winslow

Expert Author Lance Winslow

The other day, I was talking with an individual, a seasoned entrepreneur looking to raise a little capital for his next business, and he noted that he only needed a little bit of startup money to get the prototypes going, to prove concept, and to start making money.

Yes, perhaps so, and perhaps not, but how can he come up with the money if he doesn't have family members to fund it or any money of his own to invest? Okay so let's talk a little about this case study, perhaps you are in the same boat as a small time entrepreneur?

Entrepreneur says: "I have a manufacturer and sources lined up to make these devices, and it doesn't cost that much to make them, and I also have beau coups contacts to get them into the market, so I can be launched and operating for very little money."

Still, contacts are not commitments. Sources are not firm guaranteed delivery. How much, do you have a rough plan? Go ahead and copy it into an email so I can read it. If it is really cheap, you could try the "micro-funding" online sources where folks can chip in small amounts - crowd source type funding, but you'd still need a strong business plan and go get real money to really make this vision happen. What are your thoughts on the crowd source funding concept, I was asked?

Well, here are some of my thoughts, you see first off; Hope and Change are BS right? I mean you have to make it happen, that means "step 1" is still only "step 1" and is no guarantee you can get to the real goal of creating a viable business that will launch these products into the market.

Now then, should you go the crowd sourcing route, does it make sense, is that a good way to raise funds? Well, it can be, and it has worked for some folks, of course a nice business plan helps, but then at the same time you are giving away your idea to the whole world, and describing your invention, innovation, or business model to entrepreneurs, foreign imitators, and others who will merely steal your concept.

But, if you can get your funding and go to step one, quickly, complete that, and get a second round of funding to keep going at a fast pace, it could work, and yes, people have done it, and it is one source of funding. So, please consider all this and think on it.

Lance Winslow has launched a new provocative series of eBooks on Business Subjects. Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank;

Getting Your Series 6 License To Trade Securities

BySam C P

Expert Author Sam C P

The Series 6 license must be held by mutual funds representatives whether working directly for the mutual fund or one of their representatives. Any person who sells variable annuities or mutual funds must hold this license and be registered with FINR, formally known as the NASD. This license is also required by certain back office employees of a mutual fund company. Persons who quote prices or speak with the public are required to have the license.

To obtain such a license a person must be sponsored by a member of the securities industry. Generally, these persons are employed as trainees by a firm and after a period of time are sponsored to go forward to the test. Some firms hold their own training classes, which gives them the opportunity to gauge the employees' chances of passing the exam before actual sponsorship is granted. Others will require their employees to attend a "fast track" class usually lasting one to two weeks before allowing an attempt at the exam. Still others require employees to study outside of work and to prepare on their own. These firms may or may not reimburse employees for the cost of books, discs or other costs such as classes.

The Series 6 license exam is given in a testing center by an independent testing service. The environment is highly secure, requiring a picture ID for entrance and only supplied paper and pencil in the testing area. The test is taken on a computer, unless you have presented a valid medical request to take the exam in another medium. Exceptions can be made to take the exam orally or in written form for those with a verified handicap.

The exam covers the various types of securities focusing on mutual funds and how they are managed. The 100 questions are multiple choices and are often said to be difficult, as concentration on the wording and mathematics are necessary to obtain a correct answer. Passing grade for the test is 70% and many do not pass. The score is presented at the conclusion of the test.

If successful, the employee becomes a registered representative of the sponsoring firm and is licensed to sell mutual funds. Many in-house positions with the firm will also require this license due to the nature of the position. Persons who hold this license are marketable in the securities industry, as it guarantees a certain level of knowledge of mutual funds.

The Series 6 license is a valuable asset to anyone who wishes to work in the investment industry. This license must remain registered with the NASD/FINR in good standing through an active firm. If the representative wants to maintain the license, they must complete a continuing education course every two years and be an active registered representative with no lapse in registration greater than 24 months. Maintaining a Series 6 license is similar to maintaining job security in the mutual fund industry. These licenses are respected and desired by anyone who wishes a profession in the mutual fund arena.

Sam is a professional blogger and published author that focuses on helping people pass the Series 6 license exam. He has several articles about the Series 6 license and hopes to provide enough insight into the exam that people can successfully pass it on the first try.

The 12 Commandments To Follow When Presenting to Investors

ByGilles Herard, Jr.

Expert Author Gilles Herard, Jr.

In business, as in everything else, communication is key. If you want to give your project its best chance at getting funded, there are certain key points that I like to call the 12 Funding Commandments that you must abide by, questions you must answer before even your investor(s) asks. You present these clearly and concisely, you've got yourself a killer Presentation.

1) Who is the applicant (Legal name, whether you or your company or the company that will be created specifically for this project) and exact location (complete street address and full contact details)

2) Ownership of the company has to be crystal clear and if the company is controlled by a holding company: who are the principals of the holding? Investors must know who are the individuals behind the corporation, along with full contact details

3) Brief description of your project (maximum 10 lines)

4) Detailed cost of the project (no need for fancy graphs, just tell it like it is)

5) Cash invested by the principals (i.e. you or partners in project)? Do you have "skin in the game" and if you don't bring cash, what do you bring and what is the value of what you bring (a patent for instance can be worth much more than cash)

6) Do you have additional cash you can invest or are you completely broke after investing your first money? (Don't lie, they'll find out. Tell it like it is)

7) Further to the money you have invested, what is the actual value 'as is where is' of your project if you were to sell it tomorrow?

8) How much money are you looking for and under what structure (debt only, equity only or a combination of each?)

Note: make sure your figures add up if you're looking for an equity partner. If say your project is worth $1M and you're looking for $5M and say that investment will be worth 20% of your company, your math doesn't add up and that will make you look greedy - and like someone who flunked out of math class in high school.

The deal offered has to make sense.

Same reasoning - if you declare a $1M value for your project and you want to borrow $5M, what will be your investor's collateral to cover the $4M gap?

9) You need to present a detailed use of funds and a schedule of disbursement, which once again has to make sense. If you are applying for $100M to build a hotel, you will not need the lender/ investor to dump $100M into the bank account in a one shot deal (nice dream, though, isn't it?), but rather the lender/ Investor will match the disbursement of the funding to the construction ( implementation) of the project.
Same reasoning goes for all other types of projects.

10) Exit Strategy. You need to be crystal clear about the repayment of the advances (whether equity or debt) and you have to back it up with very strong supporting documents! (in any given case you need to submit a detailed and professionally prepared Business Plan)

11) Define clearly and logically the strengths and weaknesses of the project (maximum 5 lines). Again, honesty is the best policy. If your investors catch you in a lie about the weaknesses of your project, you won't get a second chance to present it.

12) Lastly, what is your experience (as promoter of this project) in the line of business related to the project; are you going into a venture you know nothing about and hoping to 'make it work' or are you a professional in your industry and you know what you're talking about?

Sometimes we are tempted to make to hide the downsides of a project, or at least downplay them, but that will work against you. Rather, if you present clearly your project and everything about it and make the investor(s) understand that you know the risks and you're ready for them, that will make you look like a much stronger candidate. These 12 Commandments can be broken down and used in most other types of presentation, whether for the expansion of a company, presenting a new business idea, or even presenting a company's standing and future vision.

Gilles Herard, Jr is a seasoned Merchant Banker and has been in the banking industry for nearly 40 years. He worked early in his career at the Toronto Dominion Bank (Canada) and later on joined Manufacturer Hanover (MH) of New York as Senior Credit Analyst. He eventually created his own Firm, Capital Corp Merchant Banking Orlando, where he syndicates and structures funding for top companies worldwide, all the while investing his own firm's funds into the projects.

As the head of Capital Corp Merchant Banking Orlando, Mr Herard has become a leading figure in international middle-market project financing and engineers all funding structures for projects at Capital Corp. Mr Herard has received numerous awards for his work and other contributions.

An Effective IT Due Diligence Process

ByJim Hoffman

IT due diligence is the process of investigating a technology company that is the target of a potential acquisition, merger or investment. IT due diligence often comes near the end of the overall due diligence process. Typically, financial and legal issues are the first priority.

Initial Contact

Once the transaction is far enough along to conduct technology due diligence, the first step is to establish contact with the target company. This is typically a senior executive. I prefer to have a phone conversation with this person to gather some high-level background information on the target company, schedule a site visit and determine the appropriate technical contact. Prior to the call, I gather my own information from the target company's website, Google, LinkedIn and any relevant information that may have already been gathered during legal and financial due diligence.

In addition, this is the opportunity to establish a "cover story" for the site visit. Since in most cases the transaction isn't public knowledge, you'll need to be on the same page as your executive contact as to why you're there. Typical explanations are "we're exploring a business relationship," "we're considering a partnership" or "the owners wanted an independent review of our technology." Whatever is decided, be sure that if you'll have a future relationship with the staff at the target company that the cover story isn't an outright lie, as that's certainly a poor way to begin your relationship.

You'll also want to gain an understanding of who at the target company has knowledge of the transaction (so you can speak freely with them) and who doesn't.

Technical Contact and Submission of Due Diligence Requests

After your initial contact with the target company, your next step typically is to reach out to a designated technical contact and provide them with a list of due diligence requests. Some people question whether this gives the target company a chance to "clean up their act," but in my experience it makes the process go much more smoothly. You can hit the ground running with more information when you arrive for the site visit, and you will probably still be able to tell if anything has been patched up just before your arrival.

Comprehensive due diligence checklists are available online, and you should add, remove and edit questions as required for the specific IT due diligence effort.

The Site Visit

For a small acquisition, the site visit will probably only last 1 - 2 days. Even if it's longer, the daily process is the same. You'll want to obtain more detailed information based on the previous information you've received, either through the due diligence requests or your on-site observations and interviews. I typically spend the evening of each day onsite reviewing my notes and using them to create followup questions.

During the site visit, you should also be able to meet with key IT staff members, or even all of them if the company is not too large. If appropriate, you'll also want to schedule product demos and set aside time for technical presentations from the technology staff on architecture, database layout, etc.

Do your best to keep things moving quickly. Remember the reason you're there - to get as much valuable information as quickly as possible.

The Due Diligence Report

After the site visit, you'll want and need to create a final report that details your findings. Sample report templates are available on the Internet. During the process of creating the report, it's normal to have followup questions for your technical contact. The report should be written for the intended audience - normally business or financial executives. Avoid being overly technical if at all possible.

Jim Hoffman has over twenty years of experience in technology companies in the healthcare, financial, telecommunications and leisure industries. Throughout his career, he has been called upon to lead many due diligence efforts, including mergers & acquisitions on both the buy and sell side. He has held numerous senior management and executive positions, and is currently the Chief Technology Officer at Besler Consulting.

Visit for more information.

Tips on How to Find Venture Capital Investors

ByMabel Miles

One of the most important concerns of people who are planning to start a business is to how are they going to fund their business. Of course, a great business plan would not work without the funds to run the idea. Some people borrow money from rich friends, some use crowd-funding technique while other loan from the bank or better yet seek equity funding from a venture capital firm.

Most business owners opt for equity funding from a venture capital firm. However, before you seek approval from venture capital investors, you should make sure that you prioritize their welfare. You should understand that once they invest in the company, they would be part owners and not just mere creditors. Therefore, they need to see long-term revenue with your company.

Here are other :

1. Make sure to come up with concrete business plan presentation - most investors look for businesses with great plans that they can support. You could not expect investors to come in without compelling ideas for your business. Therefore, before seeking for VC's, you should first take care of the business plan that you will present to them.

2. Show the investors the return of investment that they could expect - most investors are looking to three to five times return of investments. You should make sure to present to them clearly, how much they should expect in return for investing in your company. Investors will be more confident to spend money on your company when they know that they are dealing with a businessman who knows exactly what he is doing.

3. You should let them know that you know what they want - VC's are surely expecting return on their investments from five to seven years time. With this, you need to come up with exit strategy at the beginning of the discussion. You should be ready to explain to them where your company is heading as most investors look forward to another investment opportunity. You should be ready to sell, merge or go public with your company to satisfy your investors.

Following the tips mentioned in this article will help you find venture capital investors that you need for your business. However, you should make sure first, that this funding option is the one best suited for your business. If you find yourself not agreeing on some terms like having these investors as shareholders then you should look for other options to fund your business.

It is also very important to assess your potential investors. You should make sure that they have long-term record of success and that they are reliable. It is also very important that you are comfortable with their personalities and characteristics as you will be partners in the company. You will be spending many years together so you should make sure that you have great working relationship. To succeed in your business, you need not only fund or money but also peace and harmony among workers and owners.

Mabel Miles likes to share information on business plan template and nonprofit business plan as well as a host of additional services.

SR and ED Accrual Debt Financing Increases Cashflow for SMEs in a Non-Dilutive Manner

ByGerry Fung

With limited venture capital opportunities in Canada, high-tech small to medium enterprises (SMEs) often rely on friends and family, followed by government funding, in order to finance their businesses. One of the more critical forms of government financing for a SME is the Scientific Research and Experimental Development (SR&ED) tax incentive program. The SR&ED program can provide refundable tax credits (i.e. in the form of cash) to reimburse Canadian companies for eligible research and development expenses incurred.

Unfortunately, the downside of SR&ED is that it can take 1-2 years before the refund is received from the federal government. Many SMEs simply cannot afford to suspend business to wait for this critical source of funding, nor can they gain access to equity financing. This effectively creates a "funding gap" that is detrimental to further commercialization.

Financing of SR&ED Accruals Helps to Bridge Funding Gap

Recently, an innovation, non-dilutive accrual debt financing instrument has been developed that finances SR&ED claims before they are filed. Several institutions and banks exist which may factor SR&ED claims after they are filed; however, SR&ED accrual debt financing occurs BEFORE filing. To finance a claim before the filing date, a firm must have a hands-on understanding of the SR&ED claim and the SR&ED program, in order to mitigate the risk.

SR&ED accrual debt financing effectively assists SMEs to create excess cashflow to grow their businesses. Because SR&ED financing is debt-based, it is non-dilutive and far less costly than dilutive equity-based financing. From a financing perspective, a business should always take advantage of lower-cost forms of financing, before more expensive forms. Thus, SR&ED financing can effectively be used as bridge financing to extend the runaway until future rounds of funding.

More about the SR&ED Program

Administered by the Canada Revenue Agency (CRA), the Scientific Research and Experimental Development (SR&ED) program is the largest business incentive program in Canada. Currently valued at $3.5 billion, the goal of SR&ED is to encourage businesses to conduct research and development activities in Canada.

Eligible SR&ED expenditures may qualify for investment tax credits that can be refundable credits (i.e. cash refunds), non-refundable credits (i.e. to be applied, carried backwards, or carried forwards against taxable income), or a combination of both. Qualifying expenditures may include wages, materials consumed, machinery, and equipment that are attributed to:

(1) Experimental development,
(2) Applied research,
(3) Basic research, or
(4) Support work.

For more information about SR&ED and SR&ED financing, please go to North Innovation Fund's (NIF) website.

How to Find an Angel Investor?

ByMark Favre

The term "Angel Investor" has attained great popularity in the last couple of years. For those who are still new to this term, an angel investor can be a person or a small company who has a substantial net worth and they are interested in investing in a private firm which is in its earlier stages of development. New business owners try to look in for such kind of investors who are willing to offer the start-up loan for kick-starting the business. However, the main point of difference between angel investors and the normal ones are that the former seems to expect a high ROI or return on investment.

How to search for an angel investor?

1) Close to your home or business place: You can start by searching for an angels who is close to the place of your business. Although this is not a compulsory criterion, however, an individual who stays close to your business area can be easily wooed for dumping funds into your business.

2) Family and Friends: Your first search of your angle investor should start amongst your family and friends. Many a times, people close to you will be willing to invest in your business but if you do not approach them, they may be hesitant to take the first step. However, most of the critics are of the opinion that this is not a good way to start a business. Pulling in your family and friends into business might create wedges in your relationships and might affect the business in a negative manner.

3) Impressing angel investors: You need to woo in angel investors and for this a carefully designed business plan is a must. It would be better if you are able to present with the working prototype of your company. Angels would like to see for themselves if their investment will be able to give them a high return.

4) Being a part of your company: In order to prove yourself to your angel investor, you can allow them to be a part of your company. They can help you to set up your business and can impart their valuable information and advice regarding how to run your venture. This is a great way to earn respect from them and will also help them to understand that you are for real.

Finding angel investors will not be a problem if you have the determination and hard work to start a successful business.

More detailed information and useful advice can be found at Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

Tips on How to Find Venture Capital Investors

ByMabel Miles

One of the most important concerns of people who are planning to start a business is to how are they going to fund their business. Of course, a great business plan would not work without the funds to run the idea. Some people borrow money from rich friends, some use crowd-funding technique while other loan from the bank or better yet seek equity funding from a venture capital firm.

Most business owners opt for equity funding from a venture capital firm. However, before you seek approval from venture capital investors, you should make sure that you prioritize their welfare. You should understand that once they invest in the company, they would be part owners and not just mere creditors. Therefore, they need to see long-term revenue with your company.

Here are other :

1. Make sure to come up with concrete business plan presentation - most investors look for businesses with great plans that they can support. You could not expect investors to come in without compelling ideas for your business. Therefore, before seeking for VC's, you should first take care of the business plan that you will present to them.

2. Show the investors the return of investment that they could expect - most investors are looking to three to five times return of investments. You should make sure to present to them clearly, how much they should expect in return for investing in your company. Investors will be more confident to spend money on your company when they know that they are dealing with a businessman who knows exactly what he is doing.

3. You should let them know that you know what they want - VC's are surely expecting return on their investments from five to seven years time. With this, you need to come up with exit strategy at the beginning of the discussion. You should be ready to explain to them where your company is heading as most investors look forward to another investment opportunity. You should be ready to sell, merge or go public with your company to satisfy your investors.

Following the tips mentioned in this article will help you find venture capital investors that you need for your business. However, you should make sure first, that this funding option is the one best suited for your business. If you find yourself not agreeing on some terms like having these investors as shareholders then you should look for other options to fund your business.

It is also very important to assess your potential investors. You should make sure that they have long-term record of success and that they are reliable. It is also very important that you are comfortable with their personalities and characteristics as you will be partners in the company. You will be spending many years together so you should make sure that you have great working relationship. To succeed in your business, you need not only fund or money but also peace and harmony among workers and owners.

Mabel Miles likes to share information on business plan template and nonprofit business plan as well as a host of additional services.

What's Venture Capital?

ByBen Vestic

Expert Author Ben Vestic

Your basic knowledge of capital, in terms of business, is that it is the seed of any negotiations. It is the fund used for you to start the wheel of money that your business would run through. You would need it to find your business a good office space, buy office supplies, hire your pioneer staff and develop your product to be offered to your market.

But capital is not an easy object to get your hands on, you can be sure of that. There are a lot of sources but these are not lax in terms of releasing their money over something they are not sure of. Of course, even if you are the one who has the means to invest you would definitely prefer a business proposition that sounds strong and is foreseeably stable.

One particular way of obtaining funds for your business is through venture capitalists. These are companies who are financially stable and who are willing to take risks over funding potentially good startup businesses. Your business, if it has enough potential of eventually growing and becoming at par with the bigger economic players, can also be considered qualified for a venture capital. In essence, venture capital falls under private equity or the securities that envelope a business that does not run on stock exchange rates.

You may consider applying for venture capital as another form of securing a loan from a bank or a lending institution. But the difference is that in securing a loan, you would have to pay in the same form as you have acquired it-usually through cash. On the contrary, when you apply for a venture capital what you give in return is a considerably controllable portion of your business. For example, you give a quarter of your business over to the company willing to invest in your venture. This means that in most of the major decisions you would be making for your business you would have to consult as well with your venture capitalist.

Venture capitalism is a complicated way of acquiring enough funds for your startup business to launch. It is but a game of the powerful and the hungry who both want to win in the rigorous cycle of business. But it is undoubtedly beneficial not only in financing your business but also in realizing its potential based on the assessment of your venture capitalist. This is needed for your small business to gain profit.

Hello. I'm Ben Vestic, a business improvement nut and mechanic of small business website design. I like to write ways in which other owners can improve their brands and procedures to take their company up a notch.

Seeking the Best Capital Investors

ByAlston Spencer

Business is the main block of success, wealth and fame for society today. If one has great business acumen, they can succeed easily in any kind of business they venture into. All it takes is one brilliant business idea to spark off a trail of success, but many of these creative consumers lack the finances to kick start their business venture. Hence, it is important to seek out capital investors who are willing to fork the necessary money to propagate the business.

Sources of investors

There are many sources to capital investors who may assist in making an entrepreneur's dream come true. Closer to home would be families and friends who have the money to lend if the entrepreneur does not have their own funds. These familiar sources can offer interest-free loans or be a minor investor in the business set up. Family members may choose to be directors in the business with a voice in its operation. There are many ways in which familiar sources can function in the newly formed business.

Those who cannot borrow from familiar sources may seek a bank loan from banks or other financial institutions but the interest rate and loan conditions may be quite stringent especially if the business venture fails or does not take off as well as expected.

Venture capital firms

Another alternative of capital investors would be to seek the resources of an established and reputable venture capital firm for some equity funding. Business owners prefer securing equity funding from reputable venture capital firms as the funding conditions may be more attractive than that of a bank loan.

Venture capital firms are in the market to make money from those who have creative business ideas with no finances to materialize their business ideas. But these persons are not parting with their finances only; they are also co-owners of the business. They are not mere creditors waiting to collect their interest and paid up capital. They have a strong interest in the long term development of the business.

Steps to take

The role of capital investors by venture capital firms is crucial; hence, it is important to seek the best venture capital firm to be appointed. There must be a solid business plan with attractive investments over a certain period of time that would entice the preferred capital firms to be capital investors to the business in mind.

Business is the main block of success, wealth and fame for society today. If one has great business acumen, they can succeed easily in any kind of business they venture into. All it takes is one brilliant business idea to spark off a trail of success but many of these creative consumers lack the finances to kick start their business venture. Hence, it is important to seek out capital investors who are willing to fork the necessary money to propagate the business.

Welcome to New York Property Development Companies, A state of the art developer, builder, New York Property Investors and owner of residential, industrial, retail and hospitality properties. our unique innovative design and management capabilities help to maximize asset revenues and return on capital to our Capital Investors.

The JOBS Act - Crowdfunding Now Allowed

ByBruce E Methven

President Obama signed the "Jumpstart Our Business Startups Act'' (the JOBS Act) on April 5. Part of this Act authorizes crowdfunding for the first time. (Up until now, crowdfunding could only be done legally by a company effectively pre-selling its goods or services at a discount.)

That does not mean the crowdfunding provisions go into effect immediately, though. The Act gives the Securities & Exchange Commission 270 days to issue regulations for the crowdfunding offerings. No crowdfunding can be done prior to the SEC issuing those regulations. Still, the Act is expected to open up crowdfunding for a number of smaller companies.

The crowdfunding exemption applies to issuers who do not sell more than $1 million to investors under any exemption during any 12-month period. Companies that want to raise more than $1 million in 12 months will not be able to use crowdfunding.

To summarize, the amounts investors may invest is limited by their income and net worth. The crowdfunding must be done through "Conduits" registered with the Securities & Exchange Commission (SEC). Issuers may not advertise except for notices which direct investors to the Conduit. Issuers must also file annual reports with the SEC. In terms of financial disclosures, offerings of less than $100,000 in a year need only provide income-tax returns and financials certified by their CEO. With offerings between $100,000 and $500,000 in a year, the financials must be reviewed by a public accountant. For offerings between $500,000 and $1 million, the financials must be audited.

Investor Amount Restrictions

There are some restrictions on how much investors may invest. Investors who have either annual income of less than $100,000 or whose net worth (presumably excluding the principal residence) is less than $100,000 may only invest in any 12-month period the greater of $2,000 or 5 percent of the investor's annual income or net worth. One thing companies using crowdfunding will need to consider is whether they want to set higher minimums for investment, given that the administrative time for a small investor is often as much as for a large investor. If $1,000,000 were raised by having 500 people invest $2,000 each, the administrative time per investor could be a substantial part of the $2,000 contributed by each investor.

If either the annual income or net worth (again, presumably excluding the principal residence) of the investor is equal to or more than $100,000, then the investor may invest 10 percent of the investor's annual income or net worth in any 12-month period, not to exceed a maximum amount of $100,000.

(There is an inconsistency in the wording of the statute on these two categories. Presumably to fit within the second category the investor must have both income in excess of $100,000 AND (not "or") net worth of more than $100,000. Expect the SEC to address this in its regulations.)

Use of Registered Conduits Required

For better or worse, the transaction must be conducted through a licensed securities broker or funding portal (either of which we'll call a "Conduit") that has registered with the SEC for crowdfunding. The Conduit must also register with any self-regulatory organization that is applicable, such as FINRA. (There are non-brokers who are required to register with FINRA.) Part of the Conduit's duties are to: provide disclosures to investors related to risks; ensure that each investor reviews investor-education information; and confirm that the investor understands that the investor is risking the loss of the entire investment, that the investor could bear such a loss, that the investor understands the level of risk applicable to investments in startups, emerging businesses, and small issuers, and understands the risk of illiquidity.

The Conduit must also obtain a background and securities enforcement regulatory history check on each officer, director, and person holding more than 20 percent of the outstanding equity of every issuer whose securities are offered. In addition the Conduit must ensure that all offering proceeds are only provided to the issuer when the aggregate capital raised from all investors is equal to or greater than a target offering amount, and allow all investors to cancel their commitments to invest. (There are other requirements as well.)

Actions Required of Issuers

Issuers using crowdfunding have requirements to meet also. The issuer is required to make a filing with the SEC.

Further, an issuer using the crowdfunding exemption may not advertise the terms of the offering, except for notices which direct investors to the funding portal or broker, and not less than annually file with the SEC and provide to investors reports of the results of operations and financial statements of the issuer. This is unusual in that most private placement offerings do not require annual filings with the SEC.

Non-Financial Disclosures

In terms of non-financial disclosures to investors, the issuer must provide, among other things: a) the names of the directors and officers (and any persons occupying a similar status or performing a similar function), and each person holding more than 20 percent of the shares of the issuer; and b) the anticipated business plan of the issuer. There's not much surprise there.

The issuer must also disclose, among other things,1) the target offering amount, the deadline to reach the target offering amount, and regular updates regarding the progress of the issuer in meeting the target offering amount; and 2) a description of the ownership and capital structure of the issuer. The later must include, in addition to other matters, (a) the terms of the securities of the issuer being offered and each other class of security of the issuer; (b) a description of how the exercise of the rights held by the principal shareholders of the issuer could negatively impact the purchasers of the securities being offered; and (c) how the securities being offered are being valued, and examples of methods for how such securities may be valued by the issuer in the future.

Financial Disclosures

The financial description requirements depend on the amount being raised. For offerings that, together with all other crowdfunding offerings of the issuer within the preceding 12-month period, total $100,000 or less the issuer must provide: (i) the income tax returns filed by the issuer for the most recently completed year, if any, and (ii) financial statements of the issuer, which must be certified by the principal executive officer of the issuer to be true and complete in all material respects (but which do not need to be audited).

Where the current offering plus other crowdfunding offerings by the issuer total more than $100,000 but less than $500,000, the issuer must provide financial statements reviewed (but not audited) by a public accountant who is independent of the issuer.

When the total of the current offering and the crowdfunding offerings within the last 12 months total more than $500,000, audited financial statements are required. Given the expense of audited financial statements and the $1,000,000 limit on offerings, some issuers may decide not to take the crowdfunding approach.

Preemption of State Law

Thankfully, the crowdfunding provisions appear to preempt state law regarding state registration, documentation, and offering requirements. The provisions still allow the states to take enforcement actions. States are allowed to require notice filings (as is done with Rule 506 offerings) but not to charge filing fees. (Section 305.)

Much will depend on the regulations the SEC issues.

Bruce E. Methven

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Bruce E. Methven, 2232 Sixth Street Berkeley, CA 94710
Phone: (510) 649-4019; Fax: (510) 649-4024
Copyright 2012 Bruce E. Methven, All Rights Reserved.

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Grants for Small Business Startups

ByStephanie Rosendahl

Expert Author Stephanie Rosendahl

Website hosting provider explains
As it the case with any new business, capital is a necessity in order to not only launch a new business, but grow it. And many entrepreneurs are tethered to a job they dislike because they can not find the capital needed to start their new enterprise. The solution to this quandary is grants for small businesses. The advantage of a grant for a small business is that they are exempt from taxes and are interest-free. Believe it or not-there are sources of money available to business owners that equate to a free lump sum of money that you can use for start up costs as you open your own business.

Sources of grants for business owners
There are two main sources of grants for small business owners. The main source is from the government. But there are also private grants that are available. Yes, the government and private equity firms are interested in growing your business. They want you to succeed!

Government Grants
Extensive information about government grants are available online at, which is the Federal government's web site maintained in order to provide information pertinent to individuals who are looking to find and apply for federal grants

Once you choose a grant to apply for, make sure you follow the instructions for the grant proposal to the letter, and respect all guidelines and deadlines. Go to your state's Web site to discover what state government grants may also be available.

Private Foundation Grants
Private foundation grants are an excellent source of funding for small businesses. You might ask yourself.... why would a company offer to "give" away money? The truth is that many foundations NEED to donate money to charity for tax reasons, and these foundations set up trusts or endowments for specific charities or new businesses through grants.

Finding a private foundation grant is not as easy as finding a government grant. To find a private foundation grant, you might consider hiring someone that is experienced and familiar with the grant process. And more importantly, you need to find someone that is familiar with the grant process in YOUR industry. This can be a significant obstacle for some companies. If your company is not prepared to hire someone to research and write a grant proposal, do some research at Google and possibly take a class on writing a grant proposal yourself. It can be done and grants have been obtained by business owners who have no previous experience in obtaining grants.

Writing a Grant Application
The grant application process is extensive and the competition fierce. You'll want to make sure your application stands out. So, when writing or preparing to write your proposal, you will need to keep in mind that the goals for grants are to not only help business owners, but also help society. So, keep this in mind when writing your application. How will your business help society? Is there any way your business is tied into the interests of the organization sponsoring the grant? How can you show the sponsor of the grant that your business will be a good investment for the country? Most business grants are given to research and development or nonprofit businesses, because these kinds of businesses benefit all of society.

Website Hosting a Must
Start with a website hosting account. Don't rush into the grant application process before you have a website established.

And keep in mind, that just because you THINK you have a good idea, that it is. Bounce your choice off of friends and family. Do they "get it?" Do they understand why you chose it? If so, it's probably a good choice for a company. If they don't, keep working on it. If they do, then start by setting up a professional website. Your application process will require a URL and a professional web presence.

Before you do anything - before you develop a business model, a revenue model, a purpose of the company, before you establish your brand's core values and develop a tag line for the company, think long and hard about the best website for your new business enterprise.

Ms. Rosendahl has over 20 years experience in systems analysis, hosted applications, and management as well as 15 years experience in web hosting and Internet marketing. Ms. Rosendahl has a Bachelors from Houston Baptist University with a double major in Computer Information Systems and Business Management. Stephanie is the founder and CEO of website hosting firm - green hosting proudly offering dallas web hosting.

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The Industry Experienced Angle Investor Advantage Considered

ByLance Winslow

Expert Author Lance Winslow

The other day I was talking to a small business entrepreneur who had some family and friends with a bit of money. His new idea and invention for his next enterprise is relatively sound, but it is disruptive technology. He also has a friend who is an angel investor, and a few friends who are venture capitalists, so we has sources of capital to get this going. He's wondering which group he should borrow the money from because it doesn't look like he can go to a bank locally and get the money he needs to build his company. Okay so let's talk and let me explain the scenario here.

The angel investor happens to have a little bit of experience in the industry, but my entrepreneurial friend will be a disruptive technology and may not sit too well with many of the folks in the Industry Association. Nevertheless, this potential angel investor has an incredible amount of knowledge and background and could help make inroads into the industry, and has lots of contacts of potential vendors and potential corporate partners as customers. The angel investor doesn't just want to sit on the sidelines he'd like to use his expertise and help build the company as well.

In other words my entrepreneurial friend will get free mentoring, consulting, and coaching services along with the investment. In many regards if you were to hire that level of expertise it would cost him a pretty penny, but in this case he basically gets a free partner, someone to go to, and help him over the hump. Perhaps the question is; will this investing angel slow him down in the marketplace, or help them succeed? The reason I ask that is because the angel may be used to doing things the old way not the new way. Still, the entrepreneur needs to have the capital to get the business going.

If he takes the venture capital money he will have to give up too much of the company, and he is slightly worried about borrowing money from friends and family because of a previous business that didn't go so well. The business before that did, and made them all wealthy. So what should he do? Should he take some money from his friends and family, but not enough to really hurt them in case of failure, and take the remainder from the angel investor who will also be on his executive management team, even if only part-time since he is a retired gentleman? These are all good questions.

These are things that entrepreneurs needs to consider when building their company or looking for capital for a startup. There is an advantage to having an angel investor who doesn't just want to sit on the sidelines and has some monied interest. Of course, if you are using his money, it is possible he could become somewhat dictatorial in the future. Provided the personalities match up, and the two can work together this could be a match made in heaven, or have unfortunate consequences leading to a living hell. Indeed I hope you will please consider all this and think on it.

Lance Winslow has launched a new provocative series of eBooks on Business Concepts. Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank;

Strategies to Attract Venture Capital Investors to Your Ideas

ByMarcus K. Wong

The business world is a magical place that holds many different techniques to gaining what is needed. One thing that all businesses need when first starting out is venture capital. This can come from many sources, but knowing where to find it and how to get it is a huge part of the task.

Getting capital investors involves having a few key documents in place. One is a mission statement. This can define what the goals of the company are for. The other is the business plan. By telling investors what will be achieved and how it will be achieved is one of the only ways to influence their decision.

Where can one find investors though? They can be found in a vast amount of places. Between family and friends, banks, and other business owners, there are more than enough opportunities to take hold of. There are a few key things to each type of investor that can help anyone know how to find them, persuade them, and what is most commonly asked for.

Family and friends will often be the easiest investors to deal with and find. By looking around one's surroundings it is possible to find many different investors. Family is always a good starter point since they are normally very supportive. They may not ask for much in reality. All that is normally asked by them is to get the money back, or receive a small profit in return. Friends are near the same as family with expectations of an investment.

Banks on the other hand require some shopping around. If choosing to go through a bank to receive venture capital there are a few things that will be needed. The mission statement and business plan will be necessary. Financial records though may be asked for by the lenders. If this occurs, it is highly important that all personal business records be kept clearly and that a statement stating what the return investment will be is drawn up.

If choosing other business owners to have as investors, the business plan and mission statement will be necessary. With business owners though, a trade can be made to benefit both companies in the business world. Trades could include anything from monetary to material goods. These can possibly be some of the best options since business owners understand what it really means to start business.

There are many more resources available for this kind of funding through loans and the Small Business Association or otherwise known as the SBA. The choices of investors are numerous, but the research needs to be done before choosing to go with the first investor that comes along. There are more than enough people willing to invest in a business and these people will essentially become business partners. They will hold a stake of claim in the business, so it is best to choose wisely.

Marcus Wong recommends Crescent Point Venture Capital and David Hand Crescent Point for more news on venture capital and private equity in Asia.

The Fakers: How To Avoid Them When Seeking Project Financing

ByGilles Herard, Jr.

Expert Author Gilles Herard, Jr.

Have you ever been to a show where you see a fake Marilyn Monroe or a Tina Turner lookalike or even Cher? They look so much like the real deal that you can barely tell the difference!

While this can be very entertaining when you pay to see such a show, other times it's not so funny. People come to me regularly with a pre-formed bias. Why? Because they've come face-to-face with lookalike merchant bankers or project financiers, paid money for their services, and never got their funding.

So what's going on? Well, one of the first things you have to watch out for are lenders/investors who call themselves 'bancs'. Not 'banK' but 'banC' - the difference? Fake banks! There are lenders out there who call themselves bancs, like "national banc" or "investors banc" or "prudential banc". These are not in fact banks and cannot guarantee funding like a real bank would, so watch out for those vampires.

There are also fake brokers out there (shocking, I know). These brokers depend on fees and will make clients believe that they either have money of their own to invest or are connected to investors with 'deep pockets'. They will collect their fees and then will disappear (this is why our image up top has monopoly money - it's just not real, and neither are these folks).

So by the time that clients reach me, they will often have been 'played' by these types of people and institutions at least once, sometimes twice, and they come to us full of fear and complaints. They don't want to sign fees, they don't want to disburse any kind of money. They just want 100% financing. Unfortunately, that's not the way of things, and you've got to put fuel in the car if you want it to run. But allow me to say right here that if you're looking for financing,

1) Always do your research. Research the background of your funder and make sure that they are who they say they are.

2) If you're in talks with a broker, see if they belong to any professional associations

3) Check the address! You'll be surprised at what a simple Google Maps check will discover - we know of people out there who call themselves funders or brokers and when you look up the address, they're working from a small apartment on a random street!

4) Beware of false promises. If what you are being promised sounds too good to be true, it is.

At the end of the day, sometimes it comes down to a gut feeling. Trust your instincts. This is why an honest merchant banker of financier will welcome the chance the meet either at their offices or via e-conferencing. Sometimes there are unsavory characters and there are plenty of scary stories out there of people who are cheated. While I'm certainly not part of The Fakers Club, I'm well aware of them and hope to have addressed them here.

Gilles Herard, Jr is a seasoned Merchant Banker and has been in the banking industry for nearly 40 years. He worked early in his career at the Toronto Dominion Bank (Canada) and later on joined Manufacturer Hanover (MH) of New York as Senior Credit Analyst. He eventually created his own Firm, Capital Corp Merchant Banking Orlando, where he syndicates and structures funding for top companies worldwide, all the while investing his own firm's funds into the projects.

As the head of Capital Corp Merchant Banking Orlando, Mr Herard has become a leading figure in international middle-market project financing and engineers all funding structures for projects at Capital Corp. Mr Herard has received numerous awards for his work and other contributions.

Sources of Funding for Startups

ByElizabeth W Conley

Expert Author Elizabeth W Conley

There's an old adage when it comes to business that you have to spend money in order to make money. Whether you are looking to buy stock or simply get your work from home website up of the ground, you will need to find some kind of investment in order to get your business running.

There are, of course, many types of business that don't require funding in a traditional sense. Any business in which your time is the major commodity requires only an investment of hours. Even still, you may require external investment to support the period of time that you need to give to your business before the money starts coming in.

In the middle of a recession, it would be natural to think that investment is difficult to find. However, with the growth of crowd funding services such as Kickstarter, getting the money that you need to start your own business is potentially easier than ever.

The First Steps of Funding

One of the most common problems that every entrepreneur faces is underestimating how much funding is required. Equally, it is important to be careful not to overestimate, making your target amount an achievable goal.

A good first step towards estimating and obtaining the funding that you need is working out exactly how your money will be spent. This is where a business plan or investment proposal comes into play.

Without experience, writing an entire business plan can seem like an impossible task. However, there is a great deal of content online that can help you to get started. Business Link, a body funded by the UK government to promote new business, offers a step-by-step guide to writing a business plan for a new company, or one that you are hoping to grow.

Ultimately, though, there are just two guidelines that you should follow. First, figure out exactly what you need. Across advertising, stock, equipment and staff, draw up an estimated cost for every single part of your business. Secondly, make sure that you justify why you need each of these things. This is not only important information for a potential investor, but also a great way to eliminate unnecessary costs - if you can't justify it, leave it out of your plan.

Would You Invest In Yourself?

This is a great question to ask in two ways.

First, use this question to rigorously examine your business proposal, or strategy for growth. Forget everything you know about your business and your plans that isn't in that document. Would you bet your savings on the success of the company? Or would the investment be termed as high risk?

There is no right answer - some of the world's biggest organisations started out as high-risk investments. But knowledge is everything, so make sure that you know what kind of investment prospect you are before you start.

Secondly, if you'd be happy to invest in yourself, can you? Is there any way that you can find the money yourself, confident in the knowledge that your investment will pay off? Don't forget that even Lord Alan Sugar needed investment to start his business - so he took £100 from his personal savings.

Maybe you could cancel the holiday this year, or give up eating out. If it's at all feasible for you to fund your own business, work hard to make it happen.

Traditional Sources of Startup Funding

Once you have an idea of the kind of funding that you will require, it's time to start looking for investors. Although a trip to Dragon's Den is a great way to get some exposure along with the money that you need, here are a few of the more realistic traditional routes towards finance.


Banks are the most obvious place to turn for investment in your small business. A traditional bank loan usually offers good rates of interest and doesn't require you to give away part of your business. However, most bank loans will not be able to match the large-scale investments offered by venture capitalists and private investors - after all, a bank is obliged to help as many people as possible in a small way.

After putting together your proposal, approach your bank. Although some banks will offer loans to people who do not currently hold accounts with them, your own bank will have a better understanding of your finances and, hopefully, treat you preferentially.

Private Investors & Venture Capitalists

As soon as you hear the phrase 'private investor' or 'venture capitalist', it's easy to be intimidated. In fact, these terms are very simple - they are individuals or organisations that want to invest some of their money for a profit.

In return for investment, you will be asked to part with some equity in your business. For example, if your business is currently valued at £250,000, an investment of £50,000 would typically give the investor 20% of your business. In practice, this means 20% of the control and, most importantly, 20% of all profits.

Private investors are, however, likely to be more flexible. If you can connect with somebody who genuinely believes in and is passionate about your new business, you may be able to find a better deal.

A great place to start looking for venture capitalists or private investors is online. A quick Google search reveals hundreds of companies that are willing to hear investment proposals, including niche investors that are looking for specific business types.

Get Your Capital From The Crowd In The Cloud

Increasingly, investment has taken on a different face - a friendlier one.

Websites such as, and all take a distributed approach to investment, making it possible for individual consumers to invest small amounts in the products that they like. Of course, when you add these small investments up, you can get your hands on astonishing amounts of funding.

Crowd funding, also sometimes referred to as cloud funding, works like this:

You put a proposal online, detailing your business, or your idea. Include rich media such as videos and images, showing the potential of your business and any products involved.You set a target amount that you wish to source.Investors and customers can 'invest' in the business. Usually, they do so for specific rewards. This could be shared equity in the business and potential profits, one of your products, or just about anything.If you reach your target amount within the specific time (depending on the site), it's yours - the money is transferred and you can get on with building your business and thanking your investors!

According to online magazine The Browser, crowd funding websites attracted €10 million of investment in 2011.

Crowd Funding - The Glif Success Story

One of the greatest success stories comes from, where two men from New York published a proposal for a new iPhone accessory. The Glif is incredibly simple, used to mount the iPhone 4 to a tripod for better photography and filming.

The inventors offered four different levels of investment, from $5 to $250, with a target investment of $10,000. In just days, more than 5000 people had shown their support for the product by effectively 'pre-ordering'.

The Glif has since gone into full production - not with the $10,000 budget that was required, but with a staggering $137,417.

For more information on The Glif, see the Kickstarter investment page.

Crowd Funding Tests Your Idea For Free

Although some of these crowd-funding sites are tailored towards creative business, they mark the future of funding for just about everyone. Who better to get passionate about your business and make an investment than the people you hope to sell to at a later date?

What's more, crowd funding gives you the opportunity to test the market for your products or services. The people who invest money through these websites are the people you will ultimately sell to - so publishing and marketing your proposal is a free way to start building your brand right now.

The creators of The Glif could confidently proceed with production, because they had already proven a large market for their product.

And of course, if there are not willing investors for your business, maybe you should reassess if a market really exists at all.

If You Don't Ask, You Don't Get

If I was to give one piece of advice to somebody looking for investment, I would say ask for it. It sounds painfully simple but, in reality, many small businesses never get off the ground because people don't trust that they can get help.

If you have a burning idea or a great business plan, there will be somebody out there who can help you to make it a reality. So ask them! Start contacting potential sources of investment, ask your bank, and never be ashamed to want money for your business.

When you seek funding, remember that you're not asking for a favour, you're offering the chance to be a part of something exciting - your business.

Visit HomeforBusiness for more advice on running a business.

Daughter, Sister, Wife, Mother of three, PR Consultant and Entrepreneur

Like many women on most days I seem to have to juggle all my roles. On other days just three or four. This is why I founded Homeforbusiness. I recognise what it takes to be a working Mum and how to set up an online business from home with all 'pulls' of everyday family life and work.

I have always been entrepreneurial and set up by first corporate communications company, EMA Productions, in my 30s working with big corporate clients such as Texaco, Rank and Boots. Whilst it was challenging and hard work, it was quickly successful. I could focus solely on winning contracts and meeting the clients needs without family distractions and with the support of a fantastic team and office.

I feel very passionate about HomeforBusiness as I believe that lots of people want to create a better work/life balance and work from home, either setting up a new business or working as a freelancer. There are hundreds of genuine opportunities for people but often people do not know how to start. I want HomeforBusiness to empower anyone who wants to work from home profitably. With a panel of guest experts I will share share genuine business opportunities, business ideas, advice on running a business, online marketing, and health and wellbeing tips. I have also put together my favourite free online resources.

Alternative Sources of Finance for Uganda: Mara Launch Fund

ByDickson Wasake

Expert Author Dickson Wasake

One of the alternative sources of finance for Uganda is the Mara Launch fund. For many Ugandans, particularly those starting out in business with only a concept, this is a good place to start.

Basic information

Target: Start ups and early stage businesses

Sector focus: All

Amounts provided: UGX 5,000,000- UGX 10,000,000

Funding type: Venture capital

Means, rather than providing a loan, the fund takes a % of shares in the company

Key criteria
Model can be repeated across Africa;Profitable business within 3-5 years (exit period for fund);Strong management

Further information

search online for "Mara Launch Fund"

Tel: +256(0)414 233 700/800

Who is behind the fund?
Ashish J. Thakkar; CEO,Mara Group;Alex Rezida, Partner at Nangwala, Rezida & Co. advocates; andPeter Mukiza, Managing Partner in Uganda for Quantum capital.

What is the process like?

1. Submit business plan.The plan should include information consistent with the key criteria for the fund.

2. Introductory meeting. If the fund likes the plan, the investor will meet the fund team.

3. Due diligence.This means the fund "verifies" the information presented in the plan.

4. Term sheet. Document spelling out the basic terms and conditions.

My view/tips for success in accessing the funds for your business

1. Team:Venture capital funds like Mara know that a great team will develop and implement the idea successfully. If you have no internal capacity, have a professional join you so that your plan includes a strong team.

2. Executive summary. Investors are busy people and so your summary, usually one page, should have one aim in mind: "Make them eager to turn the pages". In order to do this, ensure that your executive summary captures key aspects of the document including the team, the amount required, the process, the activities to date and other information that provides a "snapshot" of your concept.

3. Repeatable model. The fund is looking for good business ideas that will transform Africa. Can the business model be repeatable not only in Uganda but perhaps Kenya, Rwanda, Tanzania?

4. Understand the fund and persons behind it. A core part of a successful business relationship is whether the two parties "connect". Investors are people and they usually invest if they like the person behind it.

In July, I met Nigel Ball, director of an affiliated entity. He is a very likeable, straight talking professional. I can therefore expect that the rest of the team will be of this nature.

Otherwise, best of luck.


Inachee is not an agent or connected to this entity, it is an independent thought leadership and advisory firm. The information provided is based on our research and experience. Whilst we have taken steps to ensure the accuracy of the information presented here, there can be no guarantee that it will remain accurate.

I am a principal at Inachee. We are passionate about helping business in Uganda to succeed. We are Inachee, an ethical thought leadership firm providing advisory for clients in Sub Saharan Africa, including Uganda. If you would like some assistance in preparing a business plan, information on other sources of finance similar to this or other ways we might assist you, please visit

6 Factors That Need to Be Considered When Starting Small Business Investments

ByPooja M Shah

Small business angel investors have opened up opportunities for people looking for ways of engaging in successful business opportunities. According to studies, many of the small businesses fail in the first 2 years. A significant percentage has a 50/50 chance of surviving during the first 5-years. The failure has been attributed to failing to observe some crucial factors taken into consideration when starting a business.

1. Reasons for starting the business - Many of the small business investments fail because they have been started for all the wrong reasons. Many persons decide to begin their own business simply because they do not like their job. However, instead of generating an enterprise, they end up generating another job. Therefore, instead of working for other companies they end up working for themselves.

2. Focus on value addition - The business is paid a value that is directly proportionate to the value that is generated at the market place. Consumers purchase a product and/or service that can help save energy, time, be more productive and make more money. To contribute towards this desire, it is important to ask how more value can be created for the customers.

3. Long-term vision - Establishing a successful business will always cost time and effort. Many times, when persons seek to make changes in their lives they are faced with setbacks. Many of these persons can be discouraged by these challenges. Therefore, a long-term vision plays an important role in motivating over temporary defeats. You will need to appreciate the fact that everything occurs for a reason. Once you embrace every experience, you will be in a position to discover miracles.

4. Capital - Business capital helps to run the business. Having capital in the form of sufficient liquid asset helps the business to invest in sufficient resources that help the business owner to generate more value into the market place.

5. Working in vs. working on the organization - You need to appreciate the fact that your business is not a job but rather an enterprise that makes profit by purely being in existence. It is necessary for you to make a distinction between business owner and self-employed. The real business owner features a system that effectively works for him as opposed to him/her working in the system.

6. Management - Good management entails planning, leading and organizing. A process sets realistic goals, manages risks, and controls the process of expansion while monitoring the revenue streams. In the process of management, it will be appropriate to make appropriate changes such as increasing income, decreasing expenses and seeking for professional advice.

We provide the best info about small business investments and small business angel investors. For further details please visit the provided links.

5 Reasons to Consider a Whole New Way of Banking

ByMike S Seantly

It is important to note the origin of some of the interesting terms used today. Many words that stand for a certain operation or procedure were coined from other words or because of something that stood out in a particular process. Such is the origin of the common term that denotes overseas investing. Birthed from the fact that most banks that house the overseas investments are located on islands, they are now regarded as places that offer offshore banking.

Suffice it to say, even banks that are located in landlocked areas are still known by the same term. Simply put, these money houses handle all the overseas investments and business transactions.

There is much to gain from this kind of system. Some of them include:


For many investors, there is need to secure the funds they have acquired particularly in places that are often plagued with strife and civil unrest. Politically, war-torn areas tend to have the investments tucked away in these money centers, as most of them are located in economically stable jurisdictions.


When it comes to these sorts of money systems, they offer a higher interest rate while operating at a low-cost base because they have minimal government involvement and say in how they are run. They are able to oppose set government regulation that would be seen as tax on domestic banks and thereby offer reduced interest rates on deposits.


There are those that are able to offer other services that are uncommon among in other banks such as anonymous bank accounts, low rate loans and such like products. This in itself entices the investor and seeks to increase the helpful aspect of overseas investing.

Creates opportunities

It is not easily realized but there are areas that based on their geographical location, are unable to participate and get involved in many of the platforms that the rest of the world does. They are too far to have a share in the opportunities. This kind of money system allows such areas a chance to have their own competitive stage to seek to entice as many overseas investors as they can.


One of the ways of securing investments is by limiting its accessibility. The more easily accessible it is, the more likely it will find its way to the wrong hands or be misused and mishandled. By ensuring it is safely placed in a far away account, the investment is more likely to live up to its expectation.

One of the more interesting considerations would be one that includes an online seller having an offshore account. The convenience of it and the possibilities of such a business idea are endless. This could propel any online businessperson to some great heights.

We provide the best info about Offshore Banking and Offshore Companies. For further details please visit the provided links.