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Can’t get Venture Capital Financing. Look at These Options

Many business owners try to finance their growing businesses by going to venture capital or angel funding groups. Although both financing options provide a great way to finance a business, they are usually hard to qualify for. And furthermore, they all require that you give up some business equity in exchange for funds. That, needless to say, can be a very steep price to pay.

There are some business financing alternatives that can allow you to finance your business, almost as effectively, without having to give up any equity. As opposed to venture funding or angel funding, these options are easy to qualify for and do not require the endless documentation and due diligence that venture money requires..

However, these can only help you if you meet the following criteria:

1. Your business is established and has commercial (not consumer) clients

2. Your business invoices between K and 0K per month

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These alternatives will help you if:

1. You need money to meet payroll, pay rent or pay supplier

2. Your customers pay you in 15 to 60 days

3. You need (or wish) your customers to pay you sooner

Your first option is called factoring (also known as invoice factoring). Factoring is ideal for businesses that cannot afford to wait 15 to 60 days to get paid by their clients. Factoring provides you with financing that is tied to your invoicing. Basically, the more your company invoices, the more financing you qualify for. This enables you to grow your company – many times exponentially – without having to give up equity.

Your second option is called purchase order financing. It works well for re-sellers, distributors, traders and wholesalers. Purchase order financing is ideal for business owners that have a large purchase order in hand, and who cannot afford to pay their suppliers to deliver the product. PO financing enables you to get a letter of credit, backed by the financing company, to pay your suppliers. This allows you to deliver on the purchase order and effectively make the sale. Usually, very little – if any – of your money is required for the transaction.

Both alternatives are easy to qualify for, take days (or a couple of weeks at most) to set up, and when used correctly allow you to grow your company exponentially.

Find More Venture Capital Established Business Articles

The Broadsmoore Group Offers New Lending Solutions For Businesses To Receive Much Needed Capital

Managing Partner AJ Discala Explains Broadsmoore’s Merchant Banking Opportunities for Small Cap Businesses

The global economic crisis that began in 2008 has left an environment where there is very little growth capital available to viable companies. Abraxas J. Discala founded The Broadsmoore Group to make sure that often overlooked quality companies are provided with the financial resources they need to achieve sustainable and lasting success.

Access to previous avenues for acquiring capital is either no longer available to small cap businesses, or it is only available at unsavory terms. Despite the Fed keeping interest rates at historic lows, the banks are not rushing to make new loans.  Private Equity Funds, which may have some funds available, are allocating to their existing portfolio companies, rather than making new investments.  Venture Capital, which once came at “Vulture Capital” prices when capital was flowing in the system, has also dried up. The Broadsmoore Group offers a unique, efficient and sustainable solution.

The Broadsmoore Group operates on the belief that the most important ingredient to success is to facilitate a safe and clear investment from the very beginning by providing in-depth due diligence and full clarity to all parties in every transaction. Each potential transaction and participant undergoes not only a thorough market and financial analysis, including a fraud analysis by a team of elite cyber intelligence experts.

When a socially responsible and economically profitable opportunity is identified, Broadsmoore invests the firm’s capital alongside its partners’, as well as a broad network of capital, to quickly execute a unique solution where benefits are shared by all parties.  In addition to linking companies with the growth capital they need, Broadsmoore also educates and empowers business leaders and investors with the common sense, analytical approach behind the financial engine and investment opportunity that is an Alternative Public Offering, or APO. An APO is simply an alternative means to bringing a private company public.

With The Broadsmoore Group, each transaction receives the dedication of a hand-selected group of seasoned professionals with proven track records and the common goal to help every partner company succeed.  This focused and accessible network of specialists possess a broad range of expertise in addition to traditional finance and merchant banking; The Broadsmoore Group teams include experts in operations, infrastructure and management systems, real estate, marketing and cyber security.

An Alternative To Venture Capital For The Healthcare Technology Entrepreneur

If you are an entrepreneur with a small healthcare technology based company looking to take it to the next level, this article should be of particular interest to you. Your natural inclination may be to seek venture capital or private equity to fund your growth. According to Jim Casparie, founder and CEO of the Venture Alliance, the odds of getting Venture funding remain below 3%. Given those odds, the six to nine month process, the heavy, often punishing valuations, the expense of the process, this might not be the best path for you to take. We have created a hybrid M&A model designed to bring the appropriate capital resources to you entrepreneurs. It allows the entrepreneur to bring in smart money and to maintain control. It combines the experiences of several technology entrepreneurs and with that of a traditional investment banker Merger and Acquisition approach and to create a model that both large industry players and the healthcare business owners are embracing.

The capital raising activities in the technology space led us to the conclusion that new product introductions were most efficiently and cost effectively the purview of the smaller, nimble, low overhead companies and not the technology giants. Most of the recent blockbuster products have been the result of an entrepreneurial effort from an early stage company bootstrapping its growth in a very cost conscious lean environment. The big companies, with all their seeming advantages experienced a high failure rate in new product introductions and the losses resulting from this art of capturing the next hot technology were substantial. Don’t get us wrong. There were hundreds of failures from the start-ups as well. However, the failure for the edgy little start-up resulted in losses in the – million range. The same result from an industry giant was often in the 0 million to 0 million range.

For every Cephalon, Epic Systems or Idec Pharmaceuticals, there are literally hundreds of companies that either flame out or never reach a critical mass beyond a loyal early adapter market. It seems like the mentality of these smaller business owners is, using the example of the popular TV show, Deal or No Deal, to hold out for the million briefcase. What about that logical contestant that objectively weighs the facts and the odds and cashes out for 0,000?

The dynamics of this market, suggested a merger and acquisition model commonly used by technology bell weather, Cisco Systems, could also be applied to a broad cross section of companies in the healthcare sector. Cisco Systems is a serial acquirer of companies. They do a tremendous amount of R&D and organic product development. They recognize, however, that they cannot possibly capture all the new developments in this rapidly changing field through internal development alone.

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Cisco seeks out investments in promising, small, technology companies and this approach has been a key element in their market dominance. They bring what we refer to as smart money to the high tech entrepreneur. They purchase a minority stake in the early stage company with a call option on acquiring the remainder at a later date with an agreed-upon valuation multiple. This structure is a brilliantly elegant method to dramatically enhance the risk reward profile of new product introduction. Here is why:

For the Entrepreneur: (Just substitute in your healthcare technology industry giant’s name that is in your category for Cisco below)

1.The involvement of Cisco – resources, market presence, brand, distribution capability is a self fulfilling prophecy to your product’s success.

2.For the same level of dilution that an entrepreneur would get from a VC, angel investor or private equity group, the entrepreneur gets the performance leverage of “smart money.” See #1.

3.The entrepreneur gets to grow his business with Cisco’s support at a far more rapid pace than he could alone. He is more likely to establish the critical mass needed for market leadership within his industry’s brief window of opportunity.

4.He gets an exit strategy with an established valuation metric while the buyer helps him make his exit much more lucrative.

5.As an old Wharton professor used to ask, “What would you rather have, all of a grape or part of a watermelon?” That sums it up pretty well. The involvement of Cisco gives the product a much better probability of growing significantly. The entrepreneur will own a meaningful portion of a far bigger asset.

For the Large Company Investor:

1.Create access to a large funnel of developing technology and products.

2.Creates a very nimble, market sensitive, product development or R&D arm.

3.Minor resource allocation to the autonomous operator during his “skunk works” market proving development stage.

4.Diversify their product development portfolio – because this approach provides for a relatively small investment in a greater number of opportunities fueled by the entrepreneurial spirit, they greatly improve the probability of creating a winner.

5.By investing early and getting an equity position in a small company and favorable valuation metrics on the call option, they pay a fraction of the market price to what they would have to pay if they acquired the company once the product had proven successful.

Let’s use two hypothetical companies to demonstrate this model, Big Green Technologies, and Mobile CRM Systems. Big Green Technologies utilized this model successfully with their investment in Mobile CRM Systems. Big Green Technologies acquired a 25% equity stake in Mobile CRM Systems in 1999 for million. While allowing this entrepreneurial firm to operate autonomously, they backed them with leverage and a modest level of capital resources. Sales exploded and Big Green Technologies exercised their call option on the remaining 75% equity in Mobile CRM Systems in 2004 for 4 million. Sales for Mobile CRM Systems were projected to hit 0 million in 2005.

Given today’s valuation metrics for a company with Mobile CRM Systems’ growth rate and profitability, their market cap is about .26 Billion, or 3 times trailing 12 months revenue. Big Green Technologies invested million initially, gave them access to their leverage, and exercised their call option for 4 million. Their effective acquisition price totaling 9 million represents an 82% discount to Mobile CRM Systems’ 2005 market cap.

Big Green Technologies is reaping additional benefits. This acquisition was the catalyst for several additional investments in the mobile computing and content end of the tech industry. These acquisitions have transformed Big Green Technologies from a low growth legacy provider into a Wall Street standout with a growing stable of high margin, high growth brands.

Big Green Technologies’ profits have tripled in four years and the stock price has doubled since 2000, far outpacing the tech industry average. This success has triggered the aggressive introduction of new products and new markets. Not bad for a million bet on a new product in 1999. Wait, let’s not forget about our entrepreneur. His total proceeds of 9 million are a fantastic 5- year result for a little company with 1999 sales of under million.

This model combining the Cisco hybrid acquisition experience with a traditional investment banking merger and acquisition process provides a vehicle to fund interesting healthcare technology companies. The small entrepreneurial firm looking for the “smart money” investment can be matched with the appropriate growth partner or the large industry player looking to enhance their new product strategy with this creative approach. This model has successfully served the technology industry through periods of outstanding growth and market value creation. Many of the same dynamics are present today in the healthcare industry and these same transaction structures can be similarly employed to create value.

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Canberra Hotels – Surviving in the Bush Capital

Canberra is the capital city of the Australia nation, filled with plenty of grassland and forest reserves not yet touched by man and machine. If you have a love for the greenery, this place would steal your heart away. You get to enjoy beautiful scenery by taking a flight into the city. Yet, if you come from a different culture altogether, there might be some difficulties in adjusting to a new place when you first get there. Here are some tips to help you survive a visit to Canberra and enjoy your trip in the best possible way.

First of all, you should be clear regarding the sort of people you will meet during your visit to this city. While a number of them are of indigenous background, a majority of the current population’s ancestors had migrated from mainly English-speaking countries. Hence, English is a common language written and spoken in this country. Second languages such as Mandarin, Italian, Greek, and Vietnamese are equally as common as the nation’s main tongue. Even with this common factor, the English language used carries a unique slang that may be difficult to get accustomed to at the beginning. By watching videos or listening to audio recordings of Canberra natives’ speech before your visit, you will hopefully have an easier time when venturing about the city.

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When it comes to common etiquette, there are a number of factors you should be watchful of. The most simple and basic greeting would be “G’day mate” which is a form of saying “Hello”. Do not feel patronized by the greeting as it may sound at first – they are just being friendly to whoever they meet on the road. They also prefer using first names, so if you introduce yourself by your last name, they may think that is your first name. A carefully study on the culture will help you realize that they are indeed a very sincere and laidback sort of people, friendlier than many people living in other parts of the world.

If it is your first time staying in Canberra, it would be best to start off by staying at reasonable priced Canberra hotels. When staying in a foreign land, there are many uncertainties such as the amount of money that would be sufficient for the trip. Thus, finding reasonable priced Canberra hotels will help you reduce your accommodation expenditure and have additional money for other things such as transportation, food, tickets to places of interest and, most importantly, shopping.

How Entrepreneurs Use Mentors to Raise Capital From Investors

For many entrepreneurs, the most difficult part of the entrepreneurial process is sourcing funds. A venture capital fund or an angel investor group might only grant 1 in 1000 entrepreneurs who cross their path the right to pitch, and only 1 in 10 of those deals might get the funding they need. So how do entrepreneurs set themselves on the path to becoming that 1 in 1000?

Mostly, it is about perception and networking. Many entrepreneurs still do not understand that if they go straight for the money their first time out, they have a 95% chance of burning the entire investment network they want to raise capital through. The perception they create with those first impressions can travel much faster than the entrepreneurs can. One investor will tell 10 others that they passed on your deal and then, even after you’ve cleaned up your presentation, you will still have a hard time getting future investors to take a serious look at your deal.

Don’t make the fatal mistake of going this process alone.

There are many, many people and organizations that want to see you succeed. But first, you have to be humble enough to realize that you don’t know it all. Although every entrepreneur believes their deal has what it takes to get funded, every deal can be improved to improve its investment success. Ask around to find a great Mentorship program.

A professional mentorship program will help fresh entrepreneurs cultivate positive perceptions with seasoned investors, thereby forging positive connections between them. Mentorship programs can allow an entrepreneur access to a wealth of guidance, advice, and connections within the venture community. Using those critical resources, entrepreneurs can drastically improve their chances of getting funded.

Innovative venture capital mentorship programs, built on award-winning research and
time-tested ideas, can help you become that 1 in 1000 entrepreneur. Such programs include the participation of venture professionals and investors as mentors who give a full review and critique of your executive summary and pitch. They also provide access to innovative programs and ideas, along with useful venture analytic tools.

Within the mentoring process, value is added to entrepreneurs through a series of critiques and question and answer sessions with seasoned venture professionals and investors. Through a third party observer, objective comments and critiques from mentors provide important feedback on how entrepreneurs appear to investors.

Positive impressions and perceptions are constructed and perfected through mentorship programs and that creates long-lasting value for entrepreneurs as they embark on their new business ideas and ventures. Such venture capital mentorship programs are the only places where venture professionals provide unbiased feedback to help entrepreneurs achieve their true potential and help them to successfully raise money.

Venture Capital Consulting

Venture capital consultants are companies or individuals that make it their goal to help a business find venture capital investors for its start up and raising venture capital needs. These companies have the contacts in the venture capital industry that the business owner needs in order to successfully land the investment deal. They charge a fee for their service, and if successful, can save a business a lot of time that would have been wasted searching the wrong way for the money needed for the business. There core job is to provide <a rel=”nofollow” onclick=”javascript:_gaq.push(['_trackPageview', '/outgoing/article_exit_link/937741']);” href= http://www.launchfn.com/>venture capital consulting</a> and <a rel=”nofollow” onclick=”javascript:_gaq.push(['_trackPageview', '/outgoing/article_exit_link/937741']);” href= http://www.launchfn.com/id187.html

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>raising venture capital</a> in quick time.

An experienced and good VC consultant can help your business obtain Venture Capital funding in many ways. Here are the main areas that could help you:

- Contacts VC consultants usually have many contacts in the industry. They can recommend the right list of venture capital firms for your industry, or find the right ones if not known right offhand.

- Business Plan Review: The business plan is the main document that gets you in the door of a VC firm. A VC consultant will work with you to revise and re-write your plan so that it will be most attractive to a VC firm.

-Market Research, if your business is a start up and you need market research to firm up statistics and market potential, a VC consultant will help you down that road.

A right venture capital consultant is a person or company who will work at knowing your business and the industry it is involved in.

Before contacting a venture capital consultant, make sure that you have a firm business plan. Business plan gives the consultant a place to start when researching the opportunity you are presenting. Before you pay the consultant any fee, talk to him or her, and find out what plan is in place to develop your plan and present it to potential investors. If you like their advice, and the consultant seems to have answers to your questions about the industry and the financial market, then you have found the right consultant.

Finding one venture capital consultant can save you much wasted time while shopping around for someone to invest in your business. Take the time to interview potential consultants until you find someone you are comfortable and who sees the potential in your business plan. The two of you will work as a team, seeking the successful financing of your new business!

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