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How Soon Should You Start Talking About Business Idea

Idea

Some people are just itching to launch their own business. But all they have is an idea.

It is true that being passionate about your idea is critical to establish a business. But should you discuss it with your friends and family before you have anything concrete?

When is the Right Time?

Naturally, all entrepreneurs are very protective when it comes to nurturing and protecting their business idea. Every entrepreneur initially fears that someone would steal his or her idea.

For that reason, it is important that you don’t share a business idea with people around you, without translating your idea into a viable business.

But in some cases, you can’t take things any further unless you share your business proposal with an investor who can finance your business. Seasoned experts recommend that you must never share any business plan or idea without getting a confidentiality and NDA agreement signed by the other party.

These legal documents are generally drafted by attorneys and must be signed before you discuss your idea.

How to Start Talking about your Business Idea?

An idea is fragile in its infancy stages. It must be developed into an elevator pitch or a business proposal before you could share it with other people. Don’t be discouraged if your idea doesn’t get the attention it deserves. Some of the best business ideas were once turned down by giant investors and people in general.

Believe in Yourself

Did you know that Chester Carlson, who was the inventor of the Xerox machine, received a rejection letter that stated ‘Who wants to copy a document on paper?’ Most of us still don’t know that his idea was turned down by 20 companies between 1939 and 1944. Today, Rank Xerox Corporation earns millions of dollars in profits.

The problem is not that you want to share your idea with people. What’s more important is who you want to share your business proposal with. Many start-ups and entrepreneurs simply abandon their business idea if they are rejected initially. But if you have worked on producing a quick and affordable solution to your target consumers’ problems, never doubt the potential of your business idea.

Many entrepreneurs or companies have re-located to other countries where there is more demand for their products or services. Every city and town has unique government-funded business development offices. You can get free or inexpensive resources to work on your business idea and find your target market.

Connect with Positive People

While keeping your business idea to yourself initially is the best policy, sometimes it helps sharing your ideas with motivated and positive people. Self-motivated individuals offer good advice and offer the best emotional support to help you launch a promising business.

But stay away from people who always bring you down. These people not just steal your energy, but can also rob you of your incredible business ideas.

Create a Strategy

Your business idea is like a small baby that has to grow before you could introduce it other people. Many entrepreneurs have an idea of what their business ideas or products are going to do, but they fail to figure out the ‘how’ part.

Work on developing a decent product or solution, before you could pitch it to investors. Work on creating an impressive proposal that highlights the best features of your idea as well as elaborates the mechanics or the process that’s involved.

When you re-invent something, you need to show why your idea is better than the rest. There has to be something unique about your business idea or product that offers something new or inventive. Going creative saves you from disastrous pitfalls and guarantees a steady source of profits.

Work on Promotion

A solid marketing strategy offers a strong back-up for your business idea. Once you have produced a great product, marketing it right lets you reach out to a wide audience. Study and reflect on how your competitors promoted their first products and services. Did they rely more on promotion or improving their initial business idea.

Relocate to a New Location

There are many reasons why many companies and business relocate to other cities or countries. Some firms require specialized employees while other companies might need an extra and affordable place to run their business.

Ask for Help

Connect with people who listen to your business ideas without any bias or prejudice. Most entrepreneurs look up to a role model if they can’t find a mentor. A mentorship or partnership between two parties can be both formal and informal.

You can also find true strength and support from your friends and family. Reaching out to others and asking for help is never a taboo for entrepreneurs. Successful people know that they can’t do everything. In fact, some of the most lucrative businesses were never built alone.

Test your Services

If you have developed a product, test it on a sample audience to identify its best and worst features. If you are setting-up an ecommerce store, make sure your website has gone through A/B testing and does not have any glitches before you run it live.

In case you have an idea for a mobile app, make sure it goes through a meticulous Quality Assurance process to get any bugs fixed. It is not easy to fool or satisfy today’s smart consumers. Once you have materialized your business idea, you need to promote it successfully across all channels to reach out to your audience.

Final Thoughts

The best time to share your ideas with your friends and family is when you know that your idea can successfully bridge the gap between a problem and a solution. The best time to share it with investors or other companies is when you have meticulously worked on creating and testing the implementation of our ideas. Never prematurely take an idea to an investor, he will reject it. Take a product or business proposal and you have higher chances of getting an approval.

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How Artificial Intelligence can be a great startup Business

Artificial

You might have heard of rising of Artificial Intelligence, right? Owing to utmost advancement in technology, people observe novel inventions in science and technology that bring unknown changes in every field of life. One of the very changes that have taken place is the incorporation of Artificial intelligence in most areas of life. Since it has been primarily infused in multiple departments of our lives, we can do a great business out of it. This article has been written to cast light on its applications and how it can be a great business. So, let us start without further ado!

What is Artificial Intelligence?

Artificial Intelligence directs the capability of machines or controlled robots to perform specific tasks that are generally affiliated with intelligent or human beings. In simple words, Artificial Intelligence makes possible the simulation of human intelligence processes and functions by machines, particularly computer programs. Operations that AI performs are learning, planning, and problem-solving.

Typical examples of Artificial intelligence are the following:

  • Self-driving cars
  • Robo-advisors
  • Conversational Bots
  • Email spam filters
  • Smart assistants
  • Article spinning software

How does AI work?

Artificial Intelligence works by merging large sets of data with intelligent, mathematical, and programming processing logarithms to absorb patterns and features in the data being analyzed by AI systems. Artificial Intelligence applications can be gauged by their working and processing. AI enhances its performance and adds expertise by assessing and measuring its performance, each time performing a set of data processing.

Since it is operated through software, it does not need any break while calculating even thousands and millions of tasks exceptionally swiftly.

It still confuses you, right? But, essentially, AI consists of many computers to solve problems, making it an entire scientific discipline.

The critical goal of Artificial Intelligence and Robotics is to model human behavior. As a result, it can solve complex problems via human-like thinking processes.

To accomplish these problems, the AI system employs a whole series of strategies, techniques, processes, and a vast range of technologies.

What disciplines comprise the field of Artificial Intelligence?

Different components can also be referred sub-fields of the most crucial science of AI.

Each of these departments is generally employed by AI:

1-Machine learning:

AI has astounding applications in this field that enables computer systems, programs, and applications to learn and improve results based on experience automatically.

2-Deep learning:

It is a particular machine learning that permits Artificial Intelligence to learn and improve by processing data. Deep understanding utilizes artificial neural networks which imitate neural networks in the human brain to process.

3-Cognitive Computing:

It is another significant part of AI dedicated to mimicking the interactions between humans and machines. This incorporates text, voice, and speech AI parts.

4-Computer Vision:

One of the most prolific and applaudable uses of AI is to review and interpret the content present on the image with the help of pattern recognition and deep learning. For example, computer Vision allows AI systems recognize components of visual data like captchas you usually find on websites.

Common Applications of Artificial Uses:  

Although Artificial Intelligence applications are great in number in our natural world, we are presenting a few uses that we observe often:

1-Cyber-security:

AI plays the pivotal role of guarding against unauthorized attacks regarding important and susceptible data of an organization, be it private or governmental. The concept of Cybersecurity has been coined to cope with savage attacks from hackers, and AI plays an important in doing so for you. AI systems can detect cyberattacks and other cyber threats by monitoring the data that has been fed. Once this system detects a cyberattack, it can trace through your data to find the origin of the attack and help to prevent a potentially devastating failure.

2-Customer Relationship Management:  

Artificial Intelligence and Robotics are bringing massive changes to Customer Relationship Management systems. Since software involved in Customer Relationship Management like Zoho and Salesforce require considerable human intervention to run the system accurately, AI has great potential in carrying out such tasks. When you AI technology to these platforms, the CRM system advances to a self-updating, auto-correcting system that causes your CRM system to excel.

3-Internet and Data Research:

Artificial intelligence helps internet users to improve their search experience by affording them more relevant information about their inclinations and circumstances. As Artificial Intelligence technology advances swiftly, users get better and more customizable experiences.

4-Data Research Assistants:

AI has eliminated all the repetitive hassles of doing emails and answering common queries by completely changing the company operating from the inside. AI offers chatbots acting as personal assistants to assist manage your emails, maintaining your calendar, and even give you suggestions about smoothening processes. Moreover, these AI assistants can also help respond to questions customers ask who call or chat online.

We have summed up Artificial Intelligence Applications.

Why is AI business worthy of investing and what is its Future?

Having thoroughly read about this technology, you might have got some understanding regarding its bright future and demand. As technology progresses by leaps to bounds, the upcoming world will likely have much more crucial problems to contemplate and devise solutions to rather than doing simple routine tasks. Therefore, its future is very bright, and it will overwhelm the globe with its catchy features. Owing to its productivity, it will be a sought-after technology that is worthy of investment. The artificial Intelligence business is still soaring and will soar with more impetus, generating humongous revenues.

Funded.com is the leading platform for accredited investors network worldwide. We monitor and provide updates on important funding events. Angel Investors and Venture Funding can be a key growth for a startup or existing business. Whether it is a first, second or third round financing having a strategic alliance with an Angel Investor or Venture Capital financing can propel a business to the next level and give the competitive edge.

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The Secret of Conceptualizing a Winning Idea for a Business Startup

Conceptualizing

For owners of business startups, conceptualizing a winning business idea is perhaps one of the most difficult things that they have encountered. Most of the time, people know that they want to have a business. The problem, however, is that they have no idea what are the things that they have to do first.

Every year, more than half a million businesses are established in the United States alone. But this number is significantly smaller than the actual number of people who are thinking of starting a new business.

Before anything else, the first thing that business owners must keep in mind is that there is no bad time to start a new business. Sometimes, people decline to push forward with their plans because of unfavorable conditions such as economic recession, among others. But thinking through this situation would reveal a lot of things – for instance, a business that was launched during uncertain times may end up being successful primarily because of less competition.

Considering this, one must think through things and consider the ups and downs of launching a new business as soon as possible.

One of the pressures of starting a new business is the fact that the would-be owner has no idea what to do. For many people, they think that the key to be successful is to invent the next big thing in their chosen fields. Unfortunately, this is not the case.

Of course, there are Bill Gates, Steve Jobs, and other noteworthy people who became famous because of their “inventions.” But we have to consider many others who rose to the top not by inventing a new product but by improving what was currently in the market.

Thus, the first rule in conceptualizing a winning business idea is not to think about a unique product or service, but rather finding products or services that you think you can improve.

To do so, take a sheet of paper and write ideas that come to your mind. Try thinking about products or services that you are really familiar with – then conceptualize how you can improve them. Do you think you can merge some services? Or perhaps make the design of a particular product more ergonomic?

The secret is thinking through things – use your head, and eventually you’ll come up with a winning idea for your startup.

 

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E-commerce Business

How E-commerce can be a great startup business and can generate considerable revenue

e-commerce business

The contemporary age is influenced by modernized e-commerce business of variegated natures that will likely generate handsome revenues and innumerable jobs. Apart from conventional businesses, the world is steering towards crafting new startups to meet the ever-changing necessities of the globe. New startup businesses are not only imperative for generating new job opportunities but also beckon the interest of fiscally gigantic investors to invest and help these businesses to soar. Startup businesses should be vigorously funded to meet the needs and prompt the researchers to invent more objects and products to enhance the living standards of society. We have dedicated this blog to accentuating the lucrativeness of the E-commerce business so that readers become conversant with it. So, let us start without further ado!

What is E-commerce?    

E-commerce implies buying and selling different products and objects via the internet and transferring data and funds. Transactions in business can be made as either business to business, which is known as B2B, Business to Consumer (B2C), Consumer to Consumer(C2C), and Consumer to Business (C2B). Often, E-commerce and E-business are interchangeably used. Similarly, e-tail is employed for the transaction processes that constitute online retail shopping.

In the previous decades, the excellent use of e-commerce platforms like Amazon and eBay has efficiently brought about pronounced growth in online sales. Scalability of this business can be fathomed by its rapid increase to 16% from 5.1% in 2007 till now. This business has a base website called the E-commerce website.

How does E-commerce work?

Essentially, it works on the internet, allowing buyers easy access to products and services they are looking for and then placing an order for the desired service or product.

Once a buyer places an order, the web browser on the buyer’s side will start communicating with the server of the online website store. Data regarding the established order will be passed on to a central computer called the order manager; after that, the data is passed on to databases managing inventory levels and a bank computer. This whole process ensures whether the customer funds are sufficient for the order to be processed. Post to order validation, the order manager will instantly inform the store’s web server, then notify the customer by displaying a message that the order has been successfully placed. After that, the order manager will convey this data to the warehouse to prepare the product to be delivered. In this phase, tangible products are dispatched to the customer’s address, whereas access is given to digital products. In E-commerce, marketplaces are dedicated for sellers to sign up and start buying services and products simply. You can use an eCommerce application instead of using a web browser to carry out all this process.

Types of E-commerce:       

A few types of e-commerce need to be understood before you start an e-commerce setup. Let us have a glance over them:   

1-Business-to-Business (B2B):

B2B implies exchanging goods, products, or services between businesses rather than between customers. Typical examples of B2B e-commerce are online directories, development, and supply exchange online stores/websites that enable businesses to search for products, services, or information and commence transactions via e-procurement interfaces. 

According to research conducted in 2017, it was predicted that B2B will surpass 1.1$ trillion in the United States by 2023.

2-Business-to-Consumer (B2C):             

It is such a retail part of e-commerce that incorporates selling products, and services by businesses to customers directly. This term became popularized during the dot-com boom in the late 1990 when online retailing was no less than a marvel! Nowadays, there is a plethora of virtual stores and malls selling products and goods. The most prominent example of a B2C e-commerce website is Amazon which is the most dominating in this spectrum!

3-Consumer-to-Consumer(C2C):

It is a type of e-commerce that incorporates trading products, services, and goods between consumers. All the transactions in the C2C kind of e-commerce are conducted by a third party that affords an online platform on which transactions take place. Typical examples of C2C e-commerce are online auctions and classified advertisements, with eBay and Craiglist one of the most renowned platforms of this ilk.

4-Consumer-to-Business (C2B):  

It is a sort of e-commerce business where consumers craft products and services for online companies and corporations to meet their manufacturing needs. This is contrary to the traditional trading model of B2C.

A prominent example of a C2B platform is a market that aims to sell royalty-free images, photographs, and design elements like iStock.

Advantages of E-commerce:

E-commerce business wields enormous profit when set up professionally. Here are some of the advantages of E-commerce that are fetching enough to invest in this business.

1-24/7 Availability:

Irrespective of electricity and internet outages, e-commerce sites are 24/7 available to generate revenue by allowing customers to browse their desired products and services from an unending panorama of variety. Its super availability makes it a worth-investing business.

2-Wide availability:

E-commerce enables the online business to span across the whole globe and possesses many products that are quickly dispatched to the customer’s doorstep. In this way, every nation or country is aimed at without much hassle, leading to massive revenue and brand development. Moreover, every person can easily avail of services by using E-commerce applications.

3- Ease of accessibility:  

Customers can easily access their desired products by scrolling through the variety of products on the online store without the hassle of physically visiting the out-let that is entailed in conventional marketing. So, this feature makes it a profitable investment business.

Why should new E-commerce businesses be started?

Our world is gradually being overwhelmed by the internet world that is changing the modality of several processes, with the conventional ones being obsoleted by the modern ones. Business through E-commerce has gravitated a huge number of people towards it since it eliminates hassles of physically outreaching the outlet, punctually adhering to time for the outlets being open. Although there are already a few booming e-commerce businesses, there is a vast scope in this business that can be racked up by targeting several specific niches and maintaining great quality and timely delivery. Therefore, we are inviting investors to help bolster E-commerce businesses since these businesses are highly profitable and easy to build a brand.

Author statement:

Funded.com is the leading platform for accredited investors network worldwide. We monitor and provide updates on important funding events. Angel Investors and Venture Funding can be a key growth for a startup or existing business. Whether it is a first, second or third round financing having a strategic alliance with an Angel Investor or Venture Capital financing can propel a business to the next level and give the competitive edge.

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Automation: The Risk to Financial Jobs

Automation

Suppose it is 2030, and you’re teaching in a business school. What will be your reaction to seeing just a handful of learners attending your class? It must be disappointing, but it has nothing to do with your pedagogical skill, nor it’s about the subject matter you’re teaching or your school’s ranking. Students do not enroll simply because the finance sector has no jobs for them. And automation is one of the main reasons behind this phenomenon.

You might find it hard to believe because management, economics, finance, and accounting are some popular subjects at the graduate level in most universities. Students opt for these subjects as they are associated with high employability; however, changing due to advances in technology and automation.

According to Opimas- a renowned consulting firm, the future will be harder for many universities in terms of selling business-related degrees. Another latest research showed that by 2050, nearly 230,000 financial jobs would be lost to artificial intelligence agents and bots.

To put it simply, when a vehicle manufacturer finds aluminum or any other material lighter, more accessible, and cheaper to make cars with than steel, they stop using it. They replace it to gain functional and financial advantage. It is the same when it comes to evaluating the future of the finance sector.

The current situation raises a few questions:

Our current and prospective financial jobs under threat? Are robotic advisers/employees the future of finance?

Let’s find out.

Artificial Intelligence- A New Generation

A survey from Aite Group –a research firm evaluated that businesses have started investing in automated portfolios. The investment rate increased to 210% in 2015. Many recent reports by market analysts found that robotics-advisers have taken over already in some giant corporations. Wall Street is just one of the examples that have replaced hundreds of its financial analysts with Robo advisors and high-tech software.

Oxford academics in its 2013’s paper claims that approximately 74% of professions are at high risk of becoming automated in the next 10 to 20 years; 54% of jobs among them will be in the finance industry, which is alarming. The phenomenon not just confined to the United States. Indian banks, for example, have also reported a decline of 9% in headcount in the last two consecutive quarters due to the hiring of robots at the workplace, which shows how automation is taking over in the finance sector.

Perhaps, it’s not surprising in finance, particularly as the banking industry is all about processing information. And most of its critical operations, like passbook update and cash deposits, have been digitized. This is one reason why financial institutions and banks are adopting advanced Artificial Intelligence (AI) technology.

This new generation of technology has enabled institutes to automate their financial tasks that were traditionally performed by humans. That includes risk management, operations, algorithmic trading, and wealth management.

For instance, the COIN program and Contract Intelligence that run on a specific machine learning system, help banks shorten the time taken to review loans. Plus, the software is excellent at providing impeccable loan servicing to customers. Considering AI’s growing dominance, Accenture predicts that the banking sector will make AI a’ primary way of interaction with the customers within three years. It is because AI enables a simple and easy user interface to help banks provide a human-like client experience.

Luvo, in this regard, is a virtual chatbot that uses IBM Watson technology to learn and understand from human interaction, making manual workforce redundant.

Fintech Grads- A Traditional Threat to Banking

This might sound surprising to you, but universities are revising and reviewing their traditional education blueprints to adapt to new technological disruption in the financial job market. Like Georgetown and Stanford University, business schools are planning to include “fintech” in their MBA programs. This inclusion aims to make students learn, understand, and master financial technology.

One reason why Fintech firms are considered an existential threat to traditional banks is that they work differently from conventional banks. Plus, not only do fintech firms understand consumer issues, but also solve them in a fraction of time. They have become a reliable funding option for customers to look to invest in various businesses.

The critical weakness of the banking system lies in its technical debt. Banks are lagging due to their antiqued IT setups that date back to the last century. Fintech, on the other hand, is in a winning position with its fast-moving and technology-led services, particularly in investment and loan systems for e-commerce businesses.

Kabbage is a perfect example that gives technology-led loans to e-commerce businesses for which traditional banking is not only slow but also inflexible when it comes to lending finances.

Application Programming Interfaces (APIs)

Application Programming Interfaces (APIs) is another financial innovation that enables Fintech providers to create applications on data of bank accounts. APIs will be a long-term solution for data providers as it takes away the crucial information (that only traditional banking employees have). Fintech providers will have the same quantity and quality of data without having any physical branches.

Is Dependence on Robotics Advisors Safe?

There is no denying that robot advisers, AI, and Fintech are changing traditional banking. Many financial analysts consider them the most significant drivers in the financial sector.

However, for many analysts, it’s still unclear to what extent automation and AI will prove to be advantageous for the financial sector. They believe that relying entirely on artificial intelligence could backfire if there are no humans to supervise everything.

Undoubtedly, robotics advisors are inexpensive and save a lot of time and effort when it comes to creating investment portfolios. But there is no guarantee that they will not struggle when it is about taking correct precautionary measures if the market becomes volatile. Thousands of machines are trying to operate the same thing at high speed.

In 2012, Knight Capital Group- a robotics stock trader lost $450 million in just 40 minutes when it went on a spending spree. That means these well programmed and high-tech robotics-traders can cause chaos and fatal errors in the financial markets.

Final Thoughts

Overall, there is no denying that rapidly growing dependence on automated devices and robotics-technologies is raising many concerns for commercial jobs. From banking systems to other financial institutes, automated technologies, like Fintech, APIs, and AI, are considered an integral part of the operations. They are slowly taking over and making employees redundant.

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Calculating Startups Costs before Approaching Investors

Startup

If you have a unique idea that you think can turn into a business startup, you should get ready to do some preparation before you take it to investors. When you present your idea, which might just be in a prototype form, to an investor, you have to be well-prepared to be scrutinized. Quite understandably, investors are always keen to know where their money is going.

They want to have full details of where you will use their money and what return their investment will generate. In order to answer their piercing questions, you have to be on top of your game, know the costs that are associated with your startup, and create ways to justify them.

Getting into the Depths of Startup Costs

You have to create a list of everything that’s going to require money to start your business. How much money you ask for from the investors also depends on what stage your startup is at. Sometimes, your business is running on a micro-level and you need money to expand it. At other times, all you have is a unique idea and possibly a prototype that proves the practical application of the concept but no money to go into production. In either case, your knowledge of the many startup costs helps you get the right investment and decides the fate of your startup.

Here is a list of the major startup costs.

Office Space, Furniture and Supplies

If you are going to have a physical location, you will need cash to arrange an office and everything that goes inside it. You can buy or rent office space. It is a pure expense when you rent it, unless you prepay a lump sum lease. Office furniture will include desks, cabinets, wooden cabins, paper, pencils, etc. These are all expenses and while some of them become your asset too, they are not the best assets you can rely on to get loans.

Professional Fees

Hiring professionals has its benefits, but you have to pay their fees and count them as expense. You will need lawyers and accountants to help you with various tax laws, zoning laws, business structuring, and any other legal matters that can arise when starting a business. If there is one thing that you can be sure of, it is that these professionals are not cheap.

Marketing, Advertising and Promotion

Marketing and advertising are the processes that don’t stop for as long as the business lives. More importantly, they start well before a business even comes into existence. Your marketing and advertising expenses will include the following and much more.

  • Brochures, leaflets, flyers, flexes, etc.
  • Cable advertisements, infomercials, etc.
  • Digital marketing e.g. SEO, PPC, email marketing, etc.
  • Giveaways, gifts for customers, special discounts for first timers, etc.
  • Your website, blog, social media pages and campaigns, etc.

In the beginning, you have to consider taking advantage of the marketing methods that are affordable yet highly productive.

Equipment

Your office furniture and supplies aren’t necessarily business equipment. Business equipment means anything that’s an integral part of your business. For example, if you are opening a restaurant then a fryer, boiler, smoke machine, microwave, etc. will be your equipment. If you are starting a gymnasium, the bench in the waiting area is not your equipment, but the elliptical machines, treadmills, rowing machines, etc. are part of your equipment.

Inventory Costs

If you are a product-selling business, you need inventory right from day one. You will have to do a lot of calculation and forecasting to come up with the right size of inventory that you will start with. You don’t want to commit too much and have excessive inventory due to the fear of spoilage. On the other hand, having too little means you will have to send your customers home or to your competitors. Investors love to ask inventory-related questions. You will always have to prove to the investors why you are producing as much inventory as you have planned to produce.

Salaries

You need workers right from the first day of your business. You cannot afford to pay your employees too much right from the beginning even if they are specialists in their fields. Your investors will not like the fact that you are paying your employees generously when your business has not even lifted off the ground. Hire your talent sensibly and after proper scrutiny to get the most out of every employee.

Taxes and Insurance

Not everything you earn can go right in your pocket. You have to pay taxes on your business property, sales, and income. Furthermore, you need proper protection for your business against lawsuits. The most important insurance covers for businesses include product liability insurance, property insurance, vehicle insurance, workers’ compensation insurance, etc.

Traveling

If the nature of your business requires you or your employees to travel, you have to factor in those costs as well. However, you should be happy to know that most of the business-related traveling expenses can be claimed as deductions. But because that money goes out of your business account, you have to calculate it among expenses too.

Cash Reserve

In addition to all the expenses stated above, you need the right size of cash reserve. Cash reserve is the money you set aside to finance your business without getting loans from banks. You take this money out of your net profit and set it aside for business expansion or to fulfill large orders. Additionally, you have to have at least six months of backup for your business to run smoothly when sales are low and profit margins are thin at the initial startup phase.

Approaching Your Investors

Now that you have a list of every expense that will come in your way at the time of starting your business, it is time you come up with a number and approach your investors. You have to be good with numbers when you stand in front of your investors. If math is not your strength, hire someone to be with you to help you answer cost-related questions from investors. Your accurate calculation and cost analysis increase your chances of impressing investors and compelling them to invest.

Calculate your startup costs and note them down because doing so will help you win over the investors and also show the transparency of your business plan. Also, it is important that you trust your calculations and avoid going back and forth on your investment demands. Asking for more or less than what you have calculated will get you in trouble down the road. Having too much will lure you into overspending, and bury you under a mountain of debt. Having too little will shrink your cash flow, which will choke your business as a result.

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Sprout Opportunity Business Wings with Angel Investors

business

Angel investors are playing a larger and larger role in the business investment community for obvious reasons. The banks are making it more and more difficult, due to a tightening of credit policies, for an entrepreneur with a new business idea or an early stage business expansion plan to find funding. Yet you can’t keep a good entrepreneur down. Angel investors see a need in the marketplace they can meet while businesses can see a need for investment fulfilled.

It’s a win-win arrangement.

Planting Seeds for Business Success

Finding adequate funding will probably always be one of the greatest challenges a business must meet. On the other hand, investors need a good place to invest their money to increase returns. The tight credit market has created the ideal forum for bringing businesses and private investors together.  By investing in companies like yours, angel investors can earn a higher rate of return while your business gets the much needed capital injection required to move forward.

One of the nice features of this type of funding is the fact startup businesses can attract the angel investors when they could not attract venture capital or equity partners due to lack of financial history. The angel investors are known for being willing to give young companies with exciting new ideas, concepts or methods opportunities they would not be able to find elsewhere.

How big is the angel investor market? According to the Center for Venture Research at the University of New Hampshire, in the first two quarters of 2010 (latest numbers reported) angel investors invested $8.5 billion. As many as 25,200 entrepreneurs obtained this type of business funding.  Many people are not aware of the size of the private investment market that includes angel investors, venture capital and equity partners.

Harvesting Success

Angels are committed to providing startup funding and even money for small business expansion. Business loans are made in numerous industries too including:

  • Healthcare
  • Energy
  • Industrial production
  • Green technologies
  • Retail
  • Biotech
  • Software
  • Computer equipment

Originally angel investors tended to be sole financiers or loose groups of investors willing to make business loans for new business ventures on an informal basis.  Today there are formal investing groups able to offer larger amounts of business funding to new enterprises if the entrepreneurs have solid business plans. In fact, the angel investing industry has grown to point where they have their own trade association called the Angel Capital Association.

One of the most common questions asked is: What makes angel investors different from venture capitalists? Though there are no formal definitions, angels are more likely to invest in startup businesses or existing businesses that are still in the early stages of operation. These are the types of businesses that often have difficulty finding traditional loans. Angels will also invest smaller amounts. In fact, the news reports are full of stories of angels making microloans.

Venture capital, on the other hand, usually invests in businesses that have been in operation for a while or have a proven financial track record of some kind. Another difference between angels and venture capitalists is angels invest their own money while venture capitalists usually invest money from formal funds created for investment purposes.

Making Good Sense

If you are searching for startup funding, approaching angel investors makes sense. This is a group of investors more open to funding entrepreneurs ready to get their small businesses up and running.

Access our network of Investors, get instantly matched with a Lender, or get a business plan by visiting us Funded.com

 

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Stardog Funded $3M for additional Series B Funding

Stardog Funded

In Arlington, Va, Stardog has expanded its Series B to $11.4 million, securing an additional $3m.

Stardog, the leading Enterprise Knowledge Graph platform, funded an additional $3M from new investors Contour Venture Partners, Dcode Capital, and Presidio Venture, the corporate venture capital arm of Sumitomo Corporation.

Stardog intends to use the additional capital to scale go-to-market operations, planning to expand EU operations and strengthen the work in the public sector.

From the statement of Kendall Clark, CEO and Founder of Stardog, their new partners have deep knowledge in critical areas of go-to-market. They plan to expand their successful EU operations, strengthen the public sector, and to establish tools and partnerships to expand access to knowledge graphs.

Fast Company recognized Stardog in its annual list of the World’s Most Innovative Companies as the 7th most innovative Enterprise. Their enterprise platform used by industry leaders such as Morgan Stanley, NASA, Schneider Electric, and Bayer.

Stardog’s platform uniquely combines graph storage, virtualization capabilities for flexible, cost-effective data integration. Their customers use Stardog for a range of solutions, such as operational resilience, pharmaceutical R&D, and situational perception.

Author statement:

Funded.com is the leading platform for accredited investors network worldwide. We monitor and provide updates on important funding events. Angel Investors and Venture Funding can be a key growth for a startup or existing business. Whether it is a first, second, or third round of financing having a strategic alliance with an Angel Investor or Venture Capital financing can propel a business to the next level and give a competitive edge.

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Does the Business Credit Card Affect Personal Credit Scores?

If you are trying to keep your startup finances separate from personal finances, you might be disappointed.  It is because the effects of your business credit card often show up on your personal credit score. Even if your business faces hardship or goes through any rough patch, it might affect your personal credit score.

That is to say, eliminating your all personal liabilities with your business credit cards is not possible as they need personal guarantees. However, if you‘re a startup, you can use a credit card that does not report your account activity to credit bureau to limit the risk. It may be one of the safest ways as some business credit cards don’t report to consumer credit bureaus but commercial credit bureaus. Also, there are credit cards that do not report a customer’s monthly payments.

But these are limited options. No matter how helpful your business credit card has been in building credit for your business, it does affect personal credit scores or credit history.

Luckily, there are some ways entrepreneurs use to minimize the risk factors related to their business credit cards and help personal credit scores instead of hurting them. Before exploring those ways, let us take a look at how business credit cards can affect your personal credit scores.

Effects of Business Credit Cards on Personal Credit

Typically, the following are the ways that can affect your credit score if you apply for or use a business credit card.

1. Credit Inquiry on Applying for Credit Card

 It is important to know that when a business owner applies for business credit cards, the card issuer considers both his/her personal credit card history and business track record. This may include investigating or checking personal credit, which may affect credit by dropping a few points in the scores.

This is one of the reasons many business credit card bureaus require a personal guarantee on applying.   That means if a business defaults on its payments, a business owner can be held liable to pay all the debts.

Click here to find and compare credit cards to find the best one for you.

2. Utilization of Ongoing Credit

Most of the banks and finance institutes report all account activities to the consumer credit bureau (Experian, Equifax, TransUnion) that includes the ratio of credit utilization of a customer. The credit balances are divided by the total amount of credit limits a user has. That means if you obtain the high balance on a business credit card, it can negatively impact your personal credit card scores.

According to credit experts, it is better to keep your credit card utilization below 30 percent. It makes your business credit cards easy to handle as they come with a high credit limit as compared to a consumer credit card. Plus, if you are planning to make a big investment in the business, it is better to apply for a loan than using your business credit card for it.

3. Reporting Delinquency

As mentioned earlier, some credit card issuers do not report monthly account activities of their customer to the consumer credit bureau. However, they may report your account if you don’t make your payments consistently.  Late payments are reported if they are delayed more than 30 days. If becomes a pattern, the negative marks do not only affect your personal credit card scores but also stay up on report for seven years.

A delinquent account is, without a doubt, an important thing to consider when it comes to improving payment history or personal credit card scores. Poor account scores or default account affects your ability to apply for loan affordable. Plus, late payments can trigger an APR penalty that can go up to 29.99 percent with some business cards.

Business Credit Card Issuer Policies that impact Personal Credit Scores

Although all credit card issuers have different policies pertaining to credit card activities, they might report the business information to credit bureaus on the same issues. It is always worth checking the policies.

  • Barclays:  may report in case of inconsistent payment record
  • American Express:  if your account doesn’t have good standing, it may report
  • Capital One: report all account activities
  • Citi:  doesn’t report account activity
  • Bank of America:  reports delinquent account
  • S.Bank:  doesn’t report account activity
  • Chase: reports when an account is delinquent more than 50 days
  • Well Fargo:  doesn’t report account activity

How to Use Your Business Credit Cards to Build Personal Credit

If you are concerned or apprehensive about the impact of a business credit card on your personal credit   scores, there are ways you can use to minimize the effects.

All you need is to practice poor credit behaviors with both your consumer and business accounts.  

Here are some of them:

Make Payments on Time

Your payment history plays a major role when it comes to building credit score or improving credit history.  It is important to pay at least half of your monthly payment on time, if you want to solidify your credit scores. Paying off the full balance each month is extremely helpful in avoiding interest entirely.

Keep Credit Balance Relatively Low

Keeping a low credit balance is always a good move as your credit utilization has a great impact on your credit scores. You can achieve it by making fewer payments through your credit cards or keeping the credit low.  In case your credit use spikes up in any month, you can manage the score by paying down the balance to help your utilization ratio come back to normal.

Use your Credit Card Wisely

There is no denying that business credit cards are a  good option to make payments for your operating expenses. But if you want to finance equipment or inventory, paying with a business credit card is harder.

 What is more, it may increase interest rate with any business loan you take.  That is why it is important to consider all your options first before you choose to make payments with your business credit cards.

Final Thoughts

In a nutshell, getting a small business credit card is a good idea for making payments, it is essential that you understand how it affects your personal credit score.            

Access our network of Angel Investors, Venture Capital or get instantly matched with a Lender, or get a business plan by visiting us Funded.com

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Ways To Secure Venture Capital for Your Business Startup

For most business startup owners, one of the most difficult aspects of their job is the task of securing venture capital. And while there are many available sources of funds out there, we have to realize that there are also a huge number of business startups that are competing for the money.

So what elements of businesses guarantee financial support from investors? Actually, there isn’t. Most of the time, the chances of securing a venture capital greatly depends on the situation, in addition to the characteristics of the business and the venture capitalist. However, despite this reality, there are some things that a business owner can do to increase his or her chances of securing financial support from venture capitalists.

Among the most important pointers that a business startup owner must remember is the need for him or her to be prepared with what’s going to happen.

Establishing a business is not as easy as coming up with an idea that will entice a large market. In addition to passion and dedication, a business owner is expected to be knowledgeable with every single aspect of his or her business. Thus, before approaching a venture capitalist, it’s important for owners to know their businesses.

This is important because it would prepare them for all sorts of questions that may arise during a presentation for potential investors. Likewise, a full understanding of the business would enhance the viability of the business plan, therefore increasing the chances of getting financial support.

Aside from being prepared with all the questions that a potential investor may ask, business owners must also have some knowledge on the people that would be the receiving end of their pitches.

Sometimes, owners tend to contact every single venture capitalist in the country. And while this increases your chances of securing investments, this also increases the amount of time that you spend looking for money. As they say, time is gold. So why spend a lot of time when you can do something much better?

Instead of calling every single venture capitalist in the planet, try to look into the list and study your chances of getting support from every single person in it. Doing this would make you realize that more than half of the people in your list would not even read your request because they are not interested on the concept of your business.

There’s no single advice that will boost your chances of securing venture capital. Nevertheless, like in any other field, being a little bit smarter will increase the possibility of getting financial support.

 

Access our network of Angel Investors, Venture Capital or get instantly matched with a Lender, or get a business plan by visiting us Funded.com