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Crowdfunding Facilitated with New Legislation

Smaller investors can now be solicited via the internet to pool resources in a practice called crowdfunding. The recently passed Jumpstart Our Business Startup Act (JOBS Act) sent to President Obama for signing is designed to make it easier for small businesses to raise capital. The main foundation of the legislation rests in giving businesses the ability to raise a limited amount of seed money or growth capital by encouraging investors to visit an SEC registered website where projects are listed.

The SEC registered websites will be used by entrepreneurs to list their businesses and present their funding needs. To drive potential investors to the website, the business will notify family, friends, customers and other individual investors that the business is listed by using social media tools like Twitter, Facebook and other internet based communication systems. The potential investors can visit the website, read about the business idea and then operate as a community to analyze and pick apart the business idea, investment opportunity, business model and so on. Once the business idea is accepted, investment money is sent by individual investors, accumulated and eventually transferred once the funding target is met. There are a number of other requirements, rules and limitations associated with this legislation, and this is only a brief summary of the law.

Legislating crowdfunding is considered by many to be an important step towards making it easier for people to become investors in small businesses. With tight capital markets, this new form of business funding can become an important source of money for startups and small businesses having difficulty accessing traditional funding sources. Professionals who connect businesses with investors can provide more information about the new legislation, and other sources of funding, and provide critical assistance with developing a successful business plan that attracts funding.

Browse www.funded.com for more advice about getting your business funded.

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Business Innovation Attracts Investors

Innovation is one of the many qualities investors look for when evaluating a potential investment opportunity. Angel investors, venture capitalists and even banks and other financial institutions are looking for new and creative ideas, problem solving approaches, business models and technology. An espresso machine for the car? Clean coal? Heat generated from fabric? “Green” bridge building material? New take on social media? All of these represent real and innovative products and services that attract investors.

Innovation represents a brand new way of managing something whether its products or services. Innovation adds an edge to competitive dynamics by spurring consumer demand and thus business growth. Investors look for the potential that a company can gain momentum as a startup entrepreneurship or as an existing business that is ready to use innovation for expansion.

Innovation in the marketplace is actually the foundation for commerce. Small businesses have generated approximately 64 percent of the net new jobs in the economy over the last 15 years. Small businesses also hire more than half of the employees working in the private sector. Entrepreneurship in all forms attracts a myriad of investors who are ready to fund the next innovation start ups or business expansions. That’s because innovation, by its very nature, finds untapped markets where consumer or business needs remain unmet. Innovation represents a goldmine of opportunity for the entrepreneur and the investor.

To attract the investors, you will need to put your ideas in a business plan. The plan will need to show how and why that untapped market exists and how and why the new idea can fill the gaps in these potential markets. For some entrepreneurs, the difficult part is not coming up with ideas. The difficult part is capturing the innovative spirit of the idea in a solid business plan. Fortunately, it’s easy to get professional assistance because some innovative ideas are simply too good to let them get away.

Browse http://www.funded.com for more advice about getting your business funded.

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Two Ways to Define Sustainability and Attract Investors

Sustainability is a topic of interest today, and it interests investors and businesses. There are two ways to consider sustainability. Sustainability may refer to the ability of a company to maintain organic growth as it expands operations. Sustainability also references corporate responsibility in support of the community and environment. Either way, many business opportunities are created and investors must decide which ones present the most opportunities.

In today’s economy, the two types of sustainability actually merge. There are companies that have found organic growth by offering environmentally sound products and services. As green technology advances, those businesses on the cutting edge of new product and service development need financing for research and development, manufacturing and innovative marketplace implementations. These are exactly the kind of companies that many investors are looking for because these entrepreneurs represent the future which means long term success.

Sustainability used to be a fad concept, but now it’s an imperative – either way you want to define sustainability. Businesses that can grow in the current economic climate are the operations that learn to be lean and productive and more likely to succeed and expand through the years. Businesses that contribute to the environment by offering green products and services are poised for explosive growth as global and domestic environmental issues come to the forefront. Investors are ready to accept the risks of opportunity as long as the business has a strong business plan. Whether you need startup funding or expansion funding, if you can show you’re a sustainability leader then there are investors ready to help you march forward.

More detailed information and useful advice can be found at https://www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Funding for Innovative MWBEs Ready to Grow

It’s true that it remains a tight capital market so finding investors in the private traditional financial institutions and locating public grant and loan funding is still challenging. Even as banks ease up on credit availability they are tightening requirements for credit approval. On the public sector side of doing business, Congress is reining in spending and that means less government money available to flow into grants and low interest small business loans. Minority and Women Owned Business Enterprises (MWBEs) must find alternative sources of capital to fund their growing businesses.

It’s a fact that MWBEs have become a powerful engine for economic growth and jobs creation. According to the 2007 U.S. Census Bureau Survey of Business Owners, MWBEs now make up the fastest growing new business segment in the U.S. To continue growing requires funding to build capacity so that small to mid-sized businesses can bid on larger procurement contracts and projects.

There is no reason to miss out on opportunities for growth because of funding when there are many alternative funding sources. These sources include angel investors, venture capital and equity partner investors. MWBEs that have a proven track record of business success and are poised to take the business to the next level of growth should not wait for the economy to pick up steam. The growing determination by large corporations to increase supplier diversity spending means that MWBEs have unprecedented opportunities to bring their innovative and creative businesses to the marketplace in expanding roles.

There are investors and there are opportunities, and that is the perfect partnership.

Browse http://www.funded.com for more advice about getting your business funded.

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Getting Down to the Details of Presenting a Business Plan

There’s plenty of information about writing business plans for investors, but what about the actual presentation? Like any job, there are details that must get attention or the big picture falls apart. During a business plan presentation, the audience is going to be considering the details of the presentation as well as the details of the plan itself.

Presentation details include things like the format, the length, the graphs and charts selected, the flow of the information presented, and the efficiency of the presentation itself. Giving investors a good impression of your organizational and presentational skills enhances the information in the business plan. Rambling or disorganized presentations can detract from the information being conveyed.

So what are these small details? The University of Texas at Dallas (UTD) business school recommends that the business plan presentation should only be approximately 30 minutes long. That may surprise some people, but we live in a society where people expect information to be conveyed quickly. Another recommendation is to keep the information on each page, slide or Powerpoint chart easy to read which means not putting too much information on it. A single page of presentation should have a maximum of 6 bullet points.

The flow of the presentation is important also. It should begin with a very brief overview of the company with a focus on why the services or products are problem solving and thus compelling. The overview is followed by a definition of the market need, the solution your products or services offer, the specific benefits conveyed to the market through your products or services and a description of the market and customers. You will also need to describe your competitive advantage. In a few presentation pages, the marketing plan and financial projections are presented.

A mistake many entrepreneurs make is developing a presentation that is too long and tedious. Investors are savvy and will ask the questions they need to know right then. However, investors and their accounting and legal advisors will study the written plan closely at a later date before making a decision. During the presentation, your goal is to get the interest of the investors to the point where they want to know more. It’s not to stuff as much information as possible into an hour.

More detailed information and useful advice can be found at https://www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Customer Focused Businesses Attract Investors

To sell a business plan to investors, you have some things to prove beyond the immediately obvious like marketing and the period the investor can expect a return on investment. You must also prove that you are customer focused from the very beginning. What does that mean exactly? It begins with a business that has products or services that solve customer problems and then expands from there.

Customer focused business plans attract investors for a good reason. The well thought out business plan that is customer focused finds a good balance between providing quality customer service with the need to achieve a return on investment. Achieving this balance is necessary because a business that is in it for the long haul must meet both goals to survive. In other words, you can’t have great customer service and lose money, and you can’t have poor customer service and a good return. If the latter situation exists, the business has moved to a company focus which means customers are being neglected. Eventually, competitors will get the neglected customers’ business.

For this reason, it’s critical that businesses needing investors prove they fully understand customer needs, can convert those needs into opportunities and have developed strategies to retain customers. The business plan will also need to prove that customers will get value for their money. In other words, the customer should be central to all decision making and planning. When investors review the business plan, they will look for customer focus as well as financial viability. In the final analysis, the two are so tied together that it’s impossible to separate them anyway.

Browse http://www.funded.com for more advice about getting your business funded.

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What are Sophisticated Investors?

When you’re searching for business capital, you want investors who can be classified as sophisticated. A sophisticated investor is someone who has the business knowledge and experience to make good decisions about investment opportunities. The knowledge and experience enables the investor to thoroughly weigh the merits and risks of a business plan and make a reasonable decision about potential profitability and thus the likelihood of earning a return on the investment.

There are other ways the term sophisticated investors is used. For example, according to the Securities and Exchange Commission, the term applies to someone able to make certain restricted investments in exempt offerings. Small companies can sell securities to these investors without registering them. The investor can buy securities without having to worry that an investment loss will impact their net worth to any degree. However, for entrepreneurs seeking small to large private investors, a sophisticated investor is someone who has hands-on experience with start-ups or business expansions and can offer expertise as well as money

All types of investors can quality as sophisticated in its broad sense. The fact is that being wealthy doesn’t automatically mean being financially experienced. There are plenty of wealthy people who have inherited money, were paid an insurance settlement, or even got lucky on an investment, yet have no idea how to manage money. The true sophisticated investor is the angel investor, venture capitalist or equity partner that has the financial savvy to make a sound investment decision after studying the business proposal in detail including the marketing plan, financial information and success strategies. The sophisticated investor understands what he or she is investing in and that’s precisely why you will benefit from their expertise.

Browse http://www.funded.com for more advice about getting your business funded.

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Angel Investors Remain Committed to Business

Angel investors have been a “significant contributor to job growth” according to the University of New Hampshire Center for Venture Funding Angel Market Analysis Report. Entrepreneurs preparing business plans may also like to know that angel investments were made in healthcare (25%), industrial/energy (17%), biotechnology (14%), software (11%), media (8%) and retail (8%). In other words, angel investors invested in most industries the first half of 2011.

Government officials frequently talk about job creation. It’s interesting to learn that jobs are being created steadily through private investment in small to medium sized startups. Small business has always claimed that real job and economic growth relies on small business success more than the success of large corporations. In fact, two-thirds of new jobs in the U.S. are due to small businesses. Startups and small business expansion play critical roles in the economy and in promoting job growth. Since angel investors fund small business, that makes them just as critical to economic growth.

In 2011, angel investors created 134,130 new jobs. The angel investors also increased their seed and startup funding in the first 2 quarters of 2011. This was interpreted as a good sign because it reflects an increasing rate of small business development which means economic and job growth. If there is any doubt of the availability and economic influence of angel investors then consider the fact that the total amount of angel investments in the first 2 quarters of 2011 was $8.9 billion.

The data clearly shows that angel investors, despite their low profile, are a powerful economic force in the U.S. If you are interested in finding startup funding, rest assured there are angel investors interested in your plans.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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The Typical Angel Investor? No Such Thing!

Have you ever wondered where angel investors come from or what type of people you are going to present a business plan to? Is it a Donald Trump type of person – flamboyant and quite wealthy? Or is the investor someone more like your neighbor down the street who has quietly amassed a small fortune yet lives frugally? The truth is that the angel investor could be either person or a group of people.

The stereotype of an angel investor is someone who is a hardened business entrepreneur who has amassed great wealth but is always ready to create more. The image is of someone who swoops in, evaluates the business plan, does some inquiries and then funds a startup with the expectation of high returns. In reality, the angel investor may not be wealthy but is financially savvy.  Many are still employed but looking for a way to grow their money by promoting innovative new businesses.

Angel investors fill a gap that exists between the venture capitalist and the commercial lender. Venture capitalists and financial institutions lend larger amounts with the former willing to accept high risk and the latter expecting minimized risk. Many angel investors invest smaller amounts of money, $20,000 instead of $200,000, but there are no limits so $500,000 up to $2 million is possible. They don’t want to play an active role in the business, but do have business savvy. Mostly they just want to make money.

Angel investors are also groups of people who pool their money to fund startup businesses. They include investment clubs, professional groups like doctors or lawyers and even other entrepreneurs. The reason there is a bit of mystery surrounding angel investors is simply because they keep a low profile, so are difficult to categorize. What you do know is that they are financially savvy, thorough in their evaluation of businesses and hopeful of earning a high return on their investments. So don’t stereotype angel investors because they can be anyone.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Enter the Angel Investors at the Startup Stage

Financing a small business is done in stages with angel investors usually funding startup expenses. The amount of startup funding needed is figured in the business plan financial section along with projected revenues. Startup funding is actually just one stage of business financing because a new business must be funded from idea conception to expansion.

Businesses operate on a continuum. Initially, seed money is needed to do the original product development, business filings, research and market survey. The  entrepreneur often gets the seed money from personal savings, family and friends, or personal loans. Some even use their credit cards or house equity. In other words, seed money usually comes from personal resources because at this stage the business is only an idea and the risk of losing the money is too high.

Once it’s determined that the idea can be turned into a solid business, the picture changes. The business plan is prepared and the enterprise begins operating. At this point, the first revenues are generated which establishes the fact that the products or services are market viable. It is at this stage, often referred to as the series A or first round investment, that angel investors are approached. However, sometimes entrepreneurs will look for outside investors who will actually pay for startup. In other words, the business doesn’t begin operating until funding is obtained from venture capitalists willing to accept higher risk investments.

Angel investors can also be approached during the second round or series B investment stage. This is the stage at which initial expansion after startup takes place and funding is needed for inventory, staff or marketing expansion.  Later expansions using angel investments would be referred to as series C, series D and so on. In this way, each investor knows by investment reference how their investment ranks in the history of the business funding.

Eventually, a successful business will look for a larger funding source like a bank to finance a major expansion. Angel investors play an important role in the launch of new businesses and enter the business at one of its most critical stages. It’s no wonder they are called “angels.”

More detailed information and useful advice can be found at http://www.funded.com/ Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.