Top 5 Most Profitable Industries

Posted by admin in business funding, Business Startups on September 15, 2014

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Top 5 Most Profitable Industries

The capability of entrepreneurs to effectively and efficiently manage their own businesses is among the requirements to succeed in this field. However, there are other factors that contribute to the actual results of a venture.

One of these, apparently, is the general performance of the sector in which the entrepreneurs establish their businesses. According to a new report, healthcare and the real estate sectors remain the most profitable sectors, comprising almost half of the list.

Despite this, what topped the list is something that is not surprising as deals with money – accounting and other related services. These are some of the most profitable sectors are as follows:

Accounting and related services

There is no denying that proving accounting and related services, such as bookkeeping and payroll services, top the list of most profitable industries at the moment. According to latest reports, the sector has a net profit margin of 19.8 percent – primarily due to high demand and low equipment overhead and equipment costs.

Legal service

Next to accounting, which is also not a surprise, is legal services. With the rise of legal issues arising both between individuals and companies, there is nothing new with reports that among the sectors that reap a big margin is the field legal service. The only surprise, perhaps, is that it did not top the list this year contrary to the last.

Oil extraction; Machinery rental

Tied on the third place are sectors concerned with oil extraction and the leasing/rental of industrial and commercial machinery equipment.

The high ranking of these two is primarily on the current policy that focuses on increased production of crude oil and the rising number of constructions and industrial development in the country in recent years.

Dental services

The fifth on the list, dental services, is quite a surprise. Who would have thought that a specialized sector would be able to compete with, for instance, industries dealing with oil extraction? On another thought, however, the number of people requiring tooth extraction – not to mention other related dental services – will remain a demand so long as the humanity survives.

Real estate leasing; Brokers; Medical service

Tied on the sixth to eighth places are the real estate leasing, real estate brokerage, and the medical profession.

According to latest reports, the improvement of the economy has resulted in the better performance of the housing market, thus the good profit margin of real estate brokers. Moreover, however, this has also pushed the profits of those engaged in rental services, the prices of which have shot up in recent months.

Meanwhile, doctors, as expected, are in the list – primarily due to the increasing population, and partly due to the issues on health and lifestyle that is affecting the new generation.

Other health practitioners; Management companies

Tied for the ninth and tenth spots are other health practitioners and management companies.

Dentists and doctors are not the only ones reaping the increase in profit margin in the past months. Expected to join them are other health practitioners, who are very much needed just like the doctors and dentists in this part of the world.

With the growing trend of businesses outsourcing management strategies to experts, those who have management backgrounds have jumped at the bandwagon and established their own companies that provide the current demand – for a profit, of course.

These ten industries are just some of the most profitable sectors that those who consider establishing businesses – or even just applying for a job – should think about. Runner-up include outpatient care services, schools, real-estate related activities, death care services, and mining support.

 

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com
Copyright 2014 Funded.com LLC

Basic Principle of Financing

Basic Principle of Financing

Poor management is often referred to as the main factor of why businesses fail. Lacking or poorly timed financing is a nearby second. Whether you are a starting up business or expanding your business, adequate capital is important. Yet it is insufficient to essentially have enough financing; understanding and planning are necessary to control it well. These qualities will ensure business owners to avoid mistake like having a wrong type of financing, or underestimating the cost of borrowing money.

Ask yourself this question before inquiring about financing:

  • Do you need more capital or can you work on with your existing cash flow?
  • How do you characterize your need?  Do you need the money because you want to expand? Or as a cushion against risk?
  • How vital is your need? You can get the best terms when you foresee your needs rather than looking for money under pressure.
  • How big is your risk? All businesses suffer from risks and danger, and the level of danger will influence expense and accessible financing plan B.
  • How strong is your management team? Management is the most important element surveyed by money sources.

Possibly most importantly, how does your need for financing mesh with your business plan? If you don't have a business plan, make writing one your first priority. All capital sources will want to see your plan for the start-up and growth of your business.

Don’t assume all money is similar

There are two types of financing: equity and debt financing. If you are looking for money you should consider your business debt to equity ratio – the difference relatively concerning dollars you've borrowed along with dollars you've invested in your organization. The harder money masters include invested in the organization, the more it really is for you to entice loan.

If your company has an excessive percentage of equity to debt, you may want to seek debt financing but if your company has a high percentage of debt to equity, experts say you should increase your ownership capital for added funds. In this way you will not be over-leverage to the point of ruining your company’s welfare.

Equity Financing and Venture Capital

Most small scale businesses use limited equity financing but with debt financing, additional equity mostly come from non-professional investors like friends, relatives, employees or customers. However, the most common source of professional equity funding comes from venture capitals. These are institutional risk takers and may be groups of wealthy individuals, government-assisted sources, or major financial institutions. Most specialize in one or a few closely related industries.

Venture capitals are sometimes seen as deep-pocketed financial gurus looking for start-ups in which to invest their money, but they most often prefer three-to-five-year old companies with the potential to become major regional or national concerns and return higher-than-average profits to their shareholders. Venture Capitals earn money by owning equity in the companies it invests in. They generally prefer to influence a business passively, but will react when a business does not perform as expected and may insist on changes in management or strategy. Changing some of the decision-making and some of the potential for profits are the main disadvantages of equity financing.

Debt Financing

Banks, savings and loans, commercial finance companies, and the SBA are some of the sources for debt financing. State and the local government have come up with programs in the recent years to give encouragement to the growth of small business to help increase the economy. Family members, friends, and former associates are all potential sources, especially when capital requirements are smaller.

Banks traditionally have been the major source of small business funding. Their main role has been as a short-term lender offering demand loans, seasonal lines of credit, or single-purpose loans. Banks generally have been unwilling to offer long-term loans to small firms. The SBA guaranteed lending program encourages banks and non-bank lenders to make long-term loans to small firms by decreasing their risk and leveraging the funds they have available. The SBA's programs have been an integral part of the success stories of thousands of firms nationally.

In addition to equity considerations, investors or lenders mostly require the borrower's personal guarantees in case of default. This will assure that the borrower has a sufficient personal interest at stake to give attention to the business. For most borrowers this is a burden, but also an obligation.

 

 
More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 
Copyright 2014 Funded.com LLC

Writing a Sure-Win Business Plan

Posted by admin in Business Plans on July 9, 2014

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Writing a Sure-Win Business Plan1

Entrepreneurs often look into their business plans as the heart of the startup. This is, according to most of them, the most important document that would ensure that the business is running towards achieving its ultimate objective.

Some business owners, however, fail to see beyond this point. The reality is that business plans are not just important in the day-to-day operations of the company. It is also important in terms of securing the most important element of a business – the funding.

A lot of entrepreneurs think that business plans do not contribute to the decision of a potential investor in funding the business. Some think that investors rely only on the pitch documents that were given to them.

Unfortunately, this is far from the reality. Most investors rely on the business plans when deciding whether or not they should fund the business. The reason is that they would not want to base their decision on documents that they know were tailor-made to impress them. These are intelligent people, and they often look for signs that the person whom they intend to partner with are also intelligent enough to make the business profitable.

This is where the need for a sure-win business plan comes into place. Instead of just writing a bland plan on how the business is expected to operate, the document should also include portions that would pique the interest of a potential investor. These include ideas on how the company will implement crucial projects, as well as handle potential problems that it would face in the future.

The bottom line is this: The business plan should not show the weakness of the company. This does not mean that the document should avoid mention of negative aspects. It should. But instead of leaving it like that, the document should also feature a “plan” on how the management would and should address it.

Instead of featuring the pessimism of the owner, the business plan should showcase the ability of the people behind the business that they are capable of handling every single problem that the start-up may face in the future.

This approach to writing a competitive business plan is an effective way of luring potential investors. It shows potential, and highlights the capability of the owners in thinking through with their plans.

Business plans are not just internal documents that are written for the sake of the employees and the main players of the company. Rather, it is a document that provides an overview of the business to external groups, most importantly the potential investors.

 
More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

Copyright 2014 Funded.com LLC

Equity crowdfunding and venture capitalism: Why it matters?

Posted by admin in Crowdfunding, Venture Capital on June 9, 2014

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Equity crowdfunding and venture capitalism

The United States government has approved a landmark law for entrepreneurs, especially those involved in the small and medium enterprises sector, in 2012. Known as the Jumpstart Our Business Startup – or JOBS – Act of 2012, the legislation enables startups to raise as much as one million dollars through various websites that will be established following the implementation of the law.

There are a number of people, both supporters and critics of JOBS Act, who argue that the law will affect the more traditional venture capitalists. They say that by providing support to crowd funding – or raising funds that come from different people to finance a business – the government essentially removed venture capitalists from the picture.

A number of people are happy with this possibility, but a whole lot more are shaking their heads. After all, venture capitalists, over a period of time, have made it possible for a lot of major businesses to flourish.

The reality, however, is that JOBS Act does not diminish the relevance of venture capitalism in the field of entrepreneurship. In fact, it can be argued that the law will strengthen the system and would enable more businesses to enter the arena. Here’s why:

Crowd funding and venture capitalism may end up having different clients

According to the law, the legislation will enable businesses to raise as much as one million dollars in capital through crowd funding that will be assisted by dedicated online portals. This in itself shows a major difference between the two funding sources.

Based on latest studies, the median of venture capitalist investments in the country in the past three months is at four million. This means that the clients of crowd funding and venture capitalism will come from different backgrounds as they will need different amounts of money.

Instead of “killing” venture capitalists, the law may have just given them the opportunity to find better deals as businesses that need smaller funding will have another platform for them to look for investments.

 

Crowd funding and venture capitalism are made for each other

These two are in fact a perfect match. With the existence of an established system of funding (i.e. crowd funding for smaller businesses and venture capitalism for slightly bigger ones), entrepreneurs will have an assurance that there will be support as their business grows.

Moreover, the existence of crowd funding system should not threaten or drive away venture capitalists as there are always businesses looking for investments. In fact, they can even use the portals to take part in crowd funding initiatives or scout possible partners that are looking for investments.

The nature of the legislation is to provide entrepreneurs – especially business startup owners – with an equal opportunity to look for people who may help them in establishing their businesses. While it is true that the law will create ripples and affect the already established system of funding in the United States, it is imperative for everyone to understand its objectives and see to it that it achieves its goals.

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

Copyright 2014 Funded.com LLC

Dealing with investors: What to do before and after close?

Posted by admin in Private Equity Financing on April 15, 2014

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Dealing with investors: What to do before and after close?

Private equity investors are considered as one of the most important people for those who want start or expand their respective businesses. After all, the amount capital that they provide and the way these are handled are among the factors that make or break a startup.

Unfortunately, a number of entrepreneurs think that dealing with private equity investors are limited to the period when the company or business is raising funds. Some believe that once the funding round has closed, the money will fall any time regardless of how they transact with the partners that signed a deal with them.

The reality is far from this misconception. Instead of forgetting about the investors who pledged to provide funds for the business once the money had been transferred, entrepreneurs must keep in mind the significance of giving importance to these people. After all, entrepreneurs would not want the investors pulling out the money in a middle of a crucial project.

Here are some tips on how entrepreneurs should deal with investors before and after the close of the funding round:

Before the close:

Once of the most crucial things that the entrepreneur must do during the funding round is to find the appropriate investor for the company. This would depend on the type of business that he or she is into. There are investors who prefer medical-related companies, while others want information technology startups, among others.

Regardless of the type of business, entrepreneurs must find a private equity investor, or those who understand the risks of investing in the nature of the business. This would mean that the investor is willing to let go of his or her money for seven years, and put it in a rather risky and illiquid asset.

To counter the risks, the entrepreneur must explain to the potential investor the positive side of the investment – for instance the high rate of return for the successful ones.

Perhaps the most important advice for the entrepreneur is to find an investor who shares the vision of the company. This is highly relevant as it would help in the growth of the business.

After the close

Once the agreement between the entrepreneur and the investor has been signed, the former must continue to look after the latter. This is necessary as it increases the possibility of future contributions from the said investor.

“Taking care” of the private equity investor does not take much. The business owner just has to provide regular updates – whether monthly or quarterly – to keep the investor on the loop. Likewise, requests must be kept reasonable and thoroughly explained. This will surely get the business owner on the good books of the investors.

Dealing with partners, especially private equity investors, is not an easy task. However, doing this the right way will ensure the continuous flow of support for the business.

Secret to Finding Angels Investors: Great Business Plan

Posted by admin in angel investors, Business Plans on March 13, 2014

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Secret to Finding Angels Investors: Great Business Plan

One of the most daunting tasks for business startup owners is finding an angel investor who would be willing to finance the bulk of the company’s expenses. And while there are a lot of possible investors out there, the number of people competing for these opportunities is also huge.

In fact, some information regarding investments showed that less than 10 percent of business startups in the United States get the nod of the most sought after angel investors in the land. This figure, however, should not discourage business owners who are competing for some financial support from investors. After all, one in every ten applicants gets the nod of an angel investor.

The question, therefore, is how will a business owners ensure that they will be the one who will get the coveted nod of an angel investor? The answer is simple – a good business plan!

While angel investors take into consideration a number of things, one of the most important criteria that they look at is the business plan. Thus, having a well polished plan is something that business startups need to have, especially if they want to secure the support of an angel investor.

There are a number ways to come up with an investor-ready business plan. But one of the first things that the entrepreneur must look at is the actual idea for the business.

Ideas should not be the one-paragraph description of what the entrepreneur wants the business to be. Rather, it should be as detailed as possible so that it covers items such as the target market, marketing strategy, capital allocation, and return of investment for possible business partners.

Having a detailed business idea is a good start into coming up with a business plan. This will assure possible investors that you are serious with the business and are not just toying around with the idea.

Ideas are one thing, but detailed understanding of the things that would have to be done to make the idea a real thing is another. Angel investors prefer the latter.

Once, would-be business owners have a detailed idea regarding the comings and goings of the proposed business, then this is the good to time come up with a good business plan.

Business plans are actual documents that detail a number of things that angel investors want to see. In addition to description of the proposed business, the plan should also include a step-by-step process on how the objectives and vision of the company will achieve.

It is necessary for the business plan to be detailed, but not long enough to bore the angel investors to death. Moreover, it should be written in a way that the investors will understand its contents.

Having a good business plan is a good way to attract angel investors. Therefore, business owners must thrive to come up with something that will entice possible partners to enter into an agreement with the company.

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

 

Copyright 2014 Funded.com LLC

The Secret of Successful Angel Investors

Posted by admin in angel investors on February 18, 2014

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The Secret of Successful Angel Investors

Having a lot of money to support potential start-ups is not the only thing an angel investor needs to be successful. While entrepreneurs often think that the only thing an angel investor invests in his or her ventures is the money, the reality is that there are more than just meets the eye.

There is no denying that money is an important element in the job of an angel investor. However, this is not the only one – he or she needs due diligence in selecting a potential business partners.

Diligence is defined as a person’s carefulness and persistence in his or her job or work. It came from the Latin term diligere, which literally means “to value highly” or “take delight in.” But in English, it usually means working hard or doing everything for the job in hopes for a successful career.

This kind of characteristic and personality is important for angel investors. Generally, would-be entrepreneurs simply think of angels as those who have a lot of money which they can use to fund start-ups, the truth is that they are perhaps the most terrifying people for business startups owners. Angels succeed because of their diligence – or more descriptively, being able to train hard eyes to entrepreneurs and make them sweat while doing their pitches or presentations.

More importantly, successful angel investors simply do not stop after scrutinizing the presentations of potential partners. He or she should not stop until the business is actually well established. Angel investors must be able to point out weaknesses on the business plan, as well as put out suggestions for the good of the business.

Unfortunately, not every angel investor has this kind of diligence. There are some who are really good in selecting potential business startups, but fail to assist its owner from achieving success. This situation is not good, both for the entrepreneur and investor themselves.

Some experts said that a number of angel investors simply think that having a lot of money will make a successful business. It is not, as angel investors are expected to help the business owners in transforming their vision and putting everything written in paper into tangent realities.

The truth is that there is no recipe for the “due diligence” needed by angel investors. The idea is very broad, and its execution will have to depend on the situation and relationship between the angel investor and the entrepreneur.

In the end, what angel investors must remember is that money will not be able to buy them success. Diligence does. Having this kind of trait is the secret of successful angel investors, and everyone who invests in business startups with potentials need to have this to ensure a good future.

This is true for business startup owners, who often think that money is everything. It is not. Entrepreneurs must find diligent angel investors who would be able to help them turn their dreams of having a successful business into a reality.

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

Copyright2014 Funded.com LLC

The secret behind the success of small businesses

Posted by admin in Small Business on January 28, 2014

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The secret behind the success of small businesses

People often think that having a small business is a difficult venture and while this is generally true to some degree, it must be emphasized that there are people who actually think of their small businesses as some sort of their pastime activity. This might be considered as a secret behind the most successful businesses.

The reality is that success of a business is relative to the level of passion of its owner. There are those whom people call “passionpreneurs,” who used their love for some things and transformed this into a small business.

For instance, there are people who love greeting cards who decided to start their own greeting card store. There are also those who love animals, and decided open pet shops to earn from what they like to do. These kinds of ventures hit two birds in one stone – establishing a small business and doing what the things the entrepreneurs love.

Unfortunately, having a passion and transforming it into a viable venture will not be as easy as it sounds. There are things that have to be addressed in order for the small business to become profitable and successful. Here are some things that a prospective entrepreneur will have to think about if he or she decides to turn his or her passion into a small business:

The Product

This is the most important thing that one has to think about when starting a business. For those who love greeting cards, it’s easy to think about the product – the greeting cards themselves.

But what about those who are passionate about other stuff like animals? Will the business sell animals, or offer services for pets? This is perhaps the most important question that a would-be entrepreneur will have to ask his or herself. After all, the product is the most important thing for a small business.

Marketing

Business is about engaging other people to avail of the product or service. And while there may be a handful of people who are also passionate about the idea of animals or greeting cards, there is also a need for the business owner to engage other “less passionate” customers to look into business. This is where marketing comes in, and it asks the question: How will you encourage other people who are not as passionate as you are to pay for your product or service?

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

Copyright2014 Funded.com LLC

Important Things to Consider Before Starting a Business

Posted by admin in Small Business on December 13, 2013

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Important Things to Consider Before Starting a Business

Profit is considered by many as one of the most important things that drive people to establish business startups. After all, businesses would not be considered as such if they fail to provide their owners with income that could ensure its continuous operations.

Despite its importance, however, people who are thinking about starting their own businesses must think about other things. It must be emphasized that the profit is just one of the many aspects that business owners have to consider before establishing their startups.

Here are some of the things that potential business owners must also think about before committing into something that could make or break a person’s career:

Reasons for establishing a business

People establish businesses because they want to earn a profit. However, there should be other reasons that could support a person’s decision to enter the world of entrepreneurship. It is often said that successful entrepreneurs are those who do not focus much attention on profit, but rather on the fulfillment brought about by the business.

Moreover, a person must also think about the reasons for choosing a particular type of business – would it focus on the field of medicine, or perhaps services that could improve people’s lives? Thinking about these things would ensure that the business would follow a right track to success.

More importantly, the would-be entrepreneur must think about his or her endgame. What is his or her ultimate goal for the business – to expand in the future and head the company until the end of time, or sell it once it’s profitable enough for the partners? Thinking about this also sets the right path for the entire business.

Resources

A person’s drive to establish a business – while an important element when it comes to entrepreneurship – is not enough if the owner wants a successful startup. Aside from the drive and conviction, there are other more tangible things that potential owners must think about before starting a business.

These include financial capital, enough human resources, and even the right amount of consumers in a specific target market.

Once these things are determined, the next question must be asked: Where will I get this? This is particularly true when it comes to money. While there are cases when friends or relatives shell out to support a business startup, this is not particularly true for everyone. A good way to solve the problem of having financial support is by looking into potential investors who would be happy to partner with business plans that exhibit promise of success.

 

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

Copyright2013 Funded.com LLC

Four ways to secure the nod of angel investors

Posted by admin in angel investors on November 15, 2013

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four ways to secure the nod

Securing an investment from an angel investor is considered as one of the most difficult aspects of establishing a business startup. For many, this is even harder than coming up with a good idea for a successful business venture.

Fortunately, there are numerous angel investors out there who can provide financial support to business startups that have potential to make it big in the market. But for entrepreneurs, the common problem is not finding them. Rather, they have a hard time securing the nod of these angel investors. Here are some ways to improve an entrepreneur’s pitch in order to be able to secure investments from angel investors:

Know the audience

A business pitch should vary depending on the character of the potential angel investor. Entrepreneurs should not rely heavily on a “standard pitch” and develop something that could connect more to the possible partners. A pitch should vary depending on various factors such as age, gender, background, and knowledge on the specific market, among others.

Be in charge

Business owners must show to their potential angel investors that they are the ones in charge of the startup. One can get the trust – and later on the deal – by showing that he or she can effectively manage the business to make it successful. In order to do this, business owners must show their expertise on the market as well as exude confidence that the venture will succeed.

Entrepreneurs, however, are cautioned not to show too much confidence on the business. After all, potential angel investors prefer realistic figures over imaginary ones.

Present relevant information

During presentation of business pitches, a number of business owners often start by presenting too much information as regards the market and the business operations itself. Most of the time, this approach is seen as a move that often ends the potential deal. Rather than presenting too much information, entrepreneurs must stick to basic data that will inform angel investors about the market and keep them interested.

Among these data include the current status of the market, as well as the basic figures concerning the business such as the capital and potential revenue in a matter of years.

Be practical

Finally, business owners must keep it practical when presenting before potential angel investors. While it is necessary to inform them of the business operations, going through every single detail of the business is not an appropriate content for a pitch. Instead, entrepreneurs should just highlight the said information and ask the potential partners if they want to know more about this.

More detailed information and useful advice can be found at http://www.funded.com 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.http://www.funded.com

 

Copyright2013 Funded.com llc