Why Entrepreneurs Should Think About Non-Dilutive Financing

Why Entrepreneurs Should Think About Non-Dilutive Financing In my more than 20 years of teaching entrepreneurship, I have learned that few aspiring business founders want to talk about the unsexy parts of the process, like when and how to get non-dilutive capital. But I have also learned that understanding the boring stuff almost always makes a big difference in...

5 Indicators It’s Time for Funding!

Funding – every business needs it, whether to bring your ideas to fruition or to capture fast moving opportunities. Yet the need for money is often an emotional subject. Here are 5 indicators to take a rational approach to ensure your next level success. Increased Sales: This may be a pivotal sign you will need to increase production, manpower, productivity, etc.  Do not wait!  This is a great time to investigate options so as to give you time to secure optimum funding based on terms, rates and limits. Developing Budgets: This is an ideal time to investigate and secure capital to help fund your ambitions of growth. Industry News: Just like you would make preparations to cut cost based on bad news, this is a great time if there will be a significant upswing because of new regulations, laws or product improvements. Business Stagnation: Sometimes a business hits a temporary plateau.  As you do your research to determine why, often times a well-executed marketing campaign or a business consultant can help you break that barrier, this may be a great way to pay for it, so you can reap the benefits. Expansion: Your business is doing well, so you have determined it’s time to expand.  Why self-fund?  With interest rates as low as they are, why not use O.P.M. (Other People’s Money)?  Your return should fairly outweigh the cost of funds. These five indicators are designed to keep you proactive and not reactive, because when you are proactive you are in charge, when you are reactive the power shifts to someone else!   Author:  Andre’ Fox Wilson Sr. “Money...

Where to go when the bank says NO?

Bummer! The bank said NO! You were well-prepared, walked into your bank confident in your brilliant business idea for your start-up or business plan for your expansion and growth — and you are walking out empty-handed… It happens everyday. In this economic climate it has become increasingly difficult to secure capital because all the traditional sources of funding have contracted to a point that they are almost non-existent. This doesn’t mean you can not obtain funding. Here are 5 ways to leverage the many alternative sources available to you: Merchant Funding: A cash advance, as a lump-sum, is obtained against future credit card receivables. Revenue based financing: Unrestricted capital for growth is provided in exchange for a small percentage of future years’ revenues. Factoring: Through a financial transaction, a business sells its account receivables (i.e. invoices) to a 3rd party (called a factor) at a discount. Asset-based lending: Capital is secured by using “hard” assets such as land, equipment, buildings, inventory, purchase orders, contracts, receivables, etc., as collateral. Equipment leasing: A firm can obtain the use of certain fixed assets for which it must pay a series of contractual, periodic, tax deductible payments. What are the trade-offs? What does the future of your capital plan look like? Choosing the right funding method for your company is of the utmost importance for your success! For more information on planning, funding, starting, and growing your business Contact Us Author: Andre F. Wilson Sr., Managing Partner, Altima Business...

10 Options to Avoid the 5 C’s of Credit

Conventional financing operates under the premise of the 5 C’s: Cash, Collateral, Capacity, Character & Conditions Cash refers to the contribution borrower will invest. Collateral refers to assets to be pledged, i.e. home, retirement, etc. Capacity refers to the measurement the lenders use to determine borrowers ability to repay loan. I.e. cash flow, existing debt, etc. Character refers to a borrower’s reputation. i.e. credit report Conditions refer to the loan amount and the interest rate the lender would consider acceptable risk to lend to borrower. As entrepreneurs we are often willing to sacrifice one or all of these in order to achieve the dream. So what if you don’t have the 5 C’s? Don’t panic, here are 10 options to secure capital from alternative resources: Factoring Asset Based Lending Merchant Funding Contract/Purchase Order Financing Hard Money Loans Debtor In Possession (DIP) Financing Equipment Leasing Asset Backed Working Capital/Sale & Leaseback Funding Business Loans Micro-Loans For more information on planning, funding, starting, and growing your business Contact Us   Author: Andre F. Wilson Sr., Managing Partner, Altima Business...