How to Get Angel Investors Interested: The idea is to have a sound business model that can be demonstrated by a business plan to have merit with goals of actions on how the model will get to point A to B with the funds provided by the angel investor or venture capital.
1: Have a concept, service, or style of doing business that is new or disruptive to the industry. This can be a service product or even an existing one, creating a unique advantage over the competition. If it is something more standard like investing in a flipping house, you can find how you may be unique to other house flippers. If you want an investor for a franchise, you can give work experience or know how to set you on top with location and research invested into the franchise, so it shows it can be a success from the start.
2: Invest in a Business Plan and Pitch Deck. Investors and banks like to see you have some plan to get from point A to B and an exit strategy for the investors’ money. Business Plans can organize your startup or exist by including major elements like Mission Statements, Distribution Channels, Corporate Structure, Marketing Research, and Financial Proformas. Pitch Decks are the visual aid that can paint a picture and a concept flow in a digital format.
3: Don’t price yourself out of the deal, but don’t give in too much. Any Angel Investors know it has to be a win-win. So, spend time wisely getting some model company financial comparisons and values on how the new capital will create a new deal on the business once everything is in place and moving.
4: Chose your platform for getting your pitch out there: You can go with crowdfunding, which can be very effective in some ways. You can raise many investors but also risk not meeting your capital requirements. You can choose a platform with only accredited investors and reach out with a posting and support. This can effectively see profiles available of investors in the industry and reach out directly or through the platform, depending on the forum. This can effectively raise capital from only one source and help provide valuable synergy and even external promotion of your new business.
Planning and patience are essential when pitching an Investor or Venture Capital. Even down markets and economies can be the best time to launch. You may get more interest and less competition as investors are looking to make equity stakes in the following future successes!
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Engaging in conversation, especially when you have to start it, can be nerve-wracking. If you want to start talking to people around you or make some new friends, then you need to work on your conversational skills. Good thing you are reading this article. Here, we have highlighted and discussed vital tips that will help you better your conversation prowess.
Keep reading to find out more.
Become an Active Listener
Do you know that listening is different from hearing? Hearing is an inborn skill, but listening is one we consciously acquire over time. When you listen to someone speak, you hear what they say, you digest the information and try to understand before giving corresponding feedback.
So yes, if you want to engage in conversations more, you have to start practicing the skill of being an active listener consciously. Give full attention to the person talking.
Active listening is not just waiting for the other person to stop talking so we can immediately respond; it is more of being engaged with what they are saying, showing interest, clarifying, and asking questions.
This goes a long way to show that you genuinely care about what they are saying and about them.
Engage with Questions
If you find it hard to make small talk, have you tried the simple method of asking questions? It is no hidden truth that people love to talk about themselves as well as the things that interest them.
So, if you ever find yourself at a loss for what to say, ask questions, especially about conversation topics that you think or know would be of interest.
Whether it is someone sitting next to on an airplane or a stranger at the grocery store, you can always start a conversation by asking open-ended questions. For instance, for the airplane scenario, you could ask, have you tried this airline before? What did you think of it?
You’d be surprised at how the talk would flow from there. Social anxiety might be preventing the person you’re conversing with from becoming engaged. But if you start the conversation with non-personal open-ended questions, you’d eliminate that feeling of trying to force a conversation.
This method can make, even a stranger, feel that you know them, and you listen. If you are engaged, your fellow conversationalist will reciprocate, and you’d have excellent communication.
Confidence Speaks!
Have you ever been in a conversation where the other person mumbled or trailed off while speaking? This can be a major turnoff.
And the truth is this can only happen if you’re distracted or you’re overly worried about how other people would perceive you. Well, you’d have to come out of that shell. You can only form a connection with people when you show your true self rather than trying to conform to what you “think” their expectations are.
When you bring up a conversation topic, be confident in the fact that what you have to say is important and worthwhile. This would cause many people to be engaged in your line of conversation.
One of the reasons why so many fail at public speaking is because they lack vital confidence in what they’re saying. Try confidence and see how it boosts your conversations!
Gadgets
Gadgets, especially your phone, could be the main reason why you’ve been finding it hard to engage others in a conversation. And it’s so sad that in this social media age, so many of us are guilty of this.
Even when others engage us in conversation, we prefer to scroll through social media pages while we talk. And why we might want to justify this by saying we are multi-tasking; it just doesn’t work that way. There’s no way the person you’re conversing with won’t notice your unfocused attention. Being distracted by your phone could seriously harm your relationship.
Paraphrasing
Earlier on, when we talked about listening, you might have decided that one of the critical differences between hearing and listening is understanding. You want to understand what people say to you before replying, and you also want to make them feel that you heard and understood them.
One of the best ways to do this is reflective listening. This involves saying back what they said to you in a paraphrase. Though this might sound repetitive, it’s a superb mental trick that will help you have more engaging conversations.
Even more impressive, this will also prevent any form of miscommunication between you and the other person.
Stop Focusing on Yourself Alone
Sometimes we become so focused on ourselves, our problems, and all that is currently going on in our lives, that we completely forget to let go of all this stress while engaging with others. When you’re talking with others, you have to let go of these distractions, so the person feels important and worth your attention.
Body Language
The importance of paying attention to body language cannot be over-emphasized. So many researches have been conducted which shows that a vast majority, as much as 90%, of our communication is non-verbal. Your body language is as important as your verbal communication, sometimes even more so.
If you’re mindful of body language, you can quickly tell when someone is interested or uninterested in what you have to say. Having your body facing the other person will help. Direct eye contact is also great.
Bottomline
If you’ve been following, we’ve discussed eight different tips that will help boost your conversation skills, and help you start up talk with people quickly. However, don’t get discouraged if you still find it hard to start up conversations with people.
These things take patience and consistency, as long as you keep applying these tips to your daily lives, you’d soon become a conversation pro.
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Whether you are running a mid-sized company or a startup, your company requires working capital with fast financing and flexibility. Factoring companies, in this regard, provide you this needed cash flow. A factoring company typically takes on waiting for burden for accounts to receive invoice payments. In return, it provides businesses and companies with timely advance cash.
There is no denying this receivable financing method is not only flexible but and also a smart financing alternative as compared to conventional business loans. Businesses need factoring when their account receivable invoices are essentially put up for sale at a discount to a factoring company. Banks, on the other hand, require businesses to go through a burdensome and long approval process to apply for a loan. Not only this, bank loan bears interest at the current market rate and often results in heavy business debt.
Reputable factoring companies, however, start your approval within twenty-four hours and can give you the funds on the same day. This duration can be of ten days, if you are a new client. Factoring doesn’t subject your business to any volatile interest rate. This means factoring financing is a great way to avoid debt on your business or company’s book.
Factoring financing is a long-term solution for business when it comes to enumerating its benefits. However, to make the most of this finance alternative, it’s important that you have sufficient knowledge of factoring. To clear the mist, here we list some potential benefits of factoring to help you understand why you should incorporate it in your business for steady cash flow.
Before plunging into the discussion of factoring benefits, let’s understand what factoring is.
What is Financial Factoring?
In financial terminology, Factoring refers to an invoice discounting and it is used as a financing tool for businesses, particularly for startups. When a business sells goods or services to its customers, it typically offers various payment terms instead of cash at sales time. Although there are a plethora of reasons why businesses practice this, developing a long-term relationship and increasing sales are the most important. In this kind of transaction, businesses usually get accounts receivable, which they hold on their books until customers clear the debt.
Businesses Can Benefit From Long-Term Factoring
If your business faces the following scenarios, invoice factoring can be really beneficial:
Volatile and unstable cash flow
Seasonal sales
Long duration sales cycle
Business needs funding to maintain production and substantial inventory
Delayed payments, such as corporate buyers and government agencies
How a Factoring Company Helps Business
A factoring company deals with invoice financing, particularly for startup and medium-sized businesses that want a non-bankable working capital solution. A factoring company, typically, purchases invoices for your business from creditworthy clients. Once you do it with crediting invoices, the company advances your business with 90 percent of invoice amount within 24 hours. The remaining balance is cleared when your client settles the payment in full.
You can submit your invoices directly after the product delivery or work completion. One of the interesting features of the factoring company is it keeps your revenues inflow and causes no collection hassles or delays.
Why Your Business Should Consider Factoring for Steady Cash Flow
Fast Way to Raise Money
As mentioned earlier, factoring is an alternative financing solution for businesses looking for swift working capital. A factoring deal does not take more than 24 hours to process and complete. If your business is in need to expand its operations quickly, factoring is your go-to option. Unlike banks and other financial solutions that take a whole lot of time in applying, processing and sanctioning, invoice factoring is a fast way to raise money. In general, businesses do not have that much time when it is about making investment or processing payments.
An Easy Way of Reliable Cash flow
There is no doubt that the availability of manageable and consistent cash flow is significant for operating a successful business. This means if your business doesn’t have a reliable cash flow, it may struggle to meet its daily financial requirements. Financing factoring, in this regard, is an effective and easy financing option that can help you improve cash flow. By using financial factoring and its steady cash flow, your business can meet its daily cash needs. You can even use that money to grow your startup into an established and successful company.
Growth and Expansion
Continuing from the last point, businesses in the growth and expansion phase require working capital. Whether your business needs to hire more employees or purchase new equipment, factoring can provide your growing business the working capital it needs. It may bring endless opportunities for your business to expand.
Maxed Out Your Business Lines of Credit
A state of maxed out credit line can bring your business cash flow to a halt. Even if your company has good credit, banks can limit the amount that you can legally obtain. This may be hazardous for your business growth. However, with invoice factoring, it is only your account receivable base size that can limit. For instance, you can obtain more working capital if your business makes new customers or signs new contracts.
A Way to Handle Slow-Paying Customers
Slow paying customers are something that businesses simply cannot avoid. Managing cash-flow becomes hard if customers take 40 to 90 days for paying the due amount. Even if you work with a Master Services Agreement (MSA), which is a payment term, there are customers who pay as per their convenience. Invoice factoring allows you to benefit from instant access to your due cash. All the due payments are received within 24 hours.
Final Thought
In a nutshell, financial factoring offers multiple benefits for companies in need to raise cash without any delays. Particularly, when a traditional bank loan is unattainable and your rapidly growing business needs to meet payroll, purchase material or cover its other operating outflows, factoring is undeniably one of the best ways you can solve all these problems.
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With the rapid growth in technologies, the ERP software market may cross $41.69 billion in profit by 2020. The statistics are enough to demonstrate the impact of this technology on businesses. This figure is undeniably impressive and reflects how important it is for companies in the future. Incorporating ERP software is one-way marketers can give their brand a competitive edge.
If your startup is in the initial phases and you are looking for a technology to help you manage business functions, ERP software is ideal, and if you don’t, this article is worth reading.
What is ERP?
ERP stands for Enterprise Resource Planning system. Many organizations use this software package to manage business activities, including project management, procurement, accounting, distribution operations, and manufacturing. It helps in day-to-day business functions while centralizing them within an integrated system.
The software is more useful when managing supply chain activities or keeping a track record of the moving parts of distribution and manufacturing. The use of ERP software is not confined to these business domains. It is utilized by many different domains that include nonprofit groups, construction, healthcare, and hospitality. Companies requiring inventory, staff, and customer management can rely on this advanced software.
In addition, ERP software stores data in a single database that allows different sections to collaborate by using the same information. ERP can organize and analyze data in the form of reports. In short, ERP software is great for bringing together the following functions into a single system:
Human resources
Financial management
Customer management
Business intelligence
Inventory
Supply chain functions
Here are some more reasons why your business needs ERP software.
Why Your Business Needs ERP Software
You might be wondering how ERP software is different from other software that performs similar functions. Although ERP software has the same goals of managing business functions, it has several unique features that make it extremely distinctive from other software.
Saves Money
You may find it a surprising fact, but ERP software is a good investment in terms of flexible pricing and saving money. For small companies, the initial price may seem heavy, but once they start using it, the software can save a lot of money.
This means ERP software can significantly increase ROI. It is merely because the system unifies multiple systems that businesses often use in fragments. From accounts payable to product development, the staff can access the necessary tools using a single centralized system. The software efficiently helps save time by keeping employees from hunting down information across different systems.
Improves Collaboration
This ERP feature generally varies as it depends upon the program business is using, but it does have a substantial impact on collaboration in one way or another. As mentioned earlier, ERP works with a unique centralized database that provides the business a source to work in collaboration. Not only does it reduces the risk of errors caused by incorrect data, but it also minimizes costs.
Moreover, ERP software reduces during projects as team members can access whatever data they need. The information doesn’t require merging within sources or systems because data is carefully collected, stored, and shared through one system. To put it simply, employees do not have to worry about the accuracy, completion, and security of data files.
Helps in Better Analytics
Businesses need ERP software if they want to improve data analytics and statistical reporting. In this regard, ERP software is ideal as its store’s data as input and makes for an unparalleled business intelligence tool. If vendors provide good functionality, ERP can be a great help in generating fast and accurate reports. The efficient software makes report compilation (that used to take days) a matter of minutes.
Besides this, the option of a customizable dashboard enables executives to see the reports when they are uploaded onto the system. The reports include information related to expense statements and custom KPIs that has essential insights for specific functions. Report access is also beneficial when a company has to make a quick and better decision.
Improves Productivity
There is no comparison of software and traditional methods that make tedious tasks even more difficult. Employees used to invest hours for monitoring inventory, generating reports, processing orders, and timesheet tracking. These tasks were time-consuming and lowered the morale of employees, increasing the risk of errors.
ERP software solves all these problems as it can conveniently automate even the most tedious task. With its integrated database, ERP eliminates all the redundant and time taking tasks, like data entry. It improves productivity by allowing the system to do advanced calculations quickly. The automatic features free up employees and allow them to focus on other essential tasks to improve ROI. That means ERP software can increase business productivity, profitability, and efficiency.
Simplified Risk Management
ERP is must-have software if your business expands internationally to keep track of imposed regulations on the business. Even if the business is local, there is a plethora of human resources, information security, and environmental rules you need to consider.
The good news is that ERP considers these regulations so that businesses can maintain compliance. The software incorporates built-in auditing features to assist businesses with documenting tax provision and chemical use. This makes everything incredibly easy, from formulating reports to sending them to the pertinent governing authority. This feature makes ERP software a great tool to manage risk.
Final Thoughts
In a nutshell, ERP software is a panacea of all the hectic, tedious, and manual business functions. The advanced software is multifunctional and helps businesses improve functions, accuracy, reliability, and financial management. The integrated system can manage a wide range of business activities, from supply chain management and procurement to accounting and operations.
In other words, businesses cannot deny this all-in-one software’s functional significance to enhance their overall productivity.
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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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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.
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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How E-commerce can be a great startup business and can generate considerable revenue
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:
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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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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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