HOW TO RAISE MONEY FOR STARTING A BUSINESS



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Summary:
HOW TO RAISE MONEY FOR STARTING A BUSINESS

Copyright ' Kevin Purfield

The task of raising money for a business is not as difficult as most
people seem to think. Actually, there's more money
available for new business ventures than there are good business ideas.

A very important rule of the game to learn: Anytime you want to raise money,
your first move should be to put together a proper prospectus.

This prospectus should include a resume of your background, your education,
training, experience and any other personal qualities that might be counted
as an asset to your potential success. Your prospective investor may not know anything
about you or your business, but if he wants to know, he can pick up
his telephone and know everything there is to know within 24 hours.
The point here is, don't ever try to 'con' a potential investor. Lay all the facts on the table for him.
In most cases, if you've got a good idea and you've done your homework
properly, an 'interested investor' will understand your position and offer
more help than you dared to ask.

When you have your prospectus prepared, know how much money you want,
exactly how it will be used, and how you intend to repay it, you're ready
to start looking for investors.

As simple as it seems, one of the easiest ways of raising money is by
advertising
Article:
HOW TO RAISE MONEY FOR STARTING A BUSINESS

Copyright © Kevin Purfield

The task of raising money for a operation is not as difficult as most
people seem to think. This is especially true when you have an idea
that can make you and your backers rich. Actually, there's more money
available for new mission ventures than there are good loyalty ideas.

A very important rule of the game to learn: Anytime you want to raise money,
your first move should be to put together a proper prospectus.

This prospectus should include a resume of your background, your education,
training, experience and any other personal qualities that might be counted
as an principal to your potential success. It's also a good idea to list
the various loans you've had in the past, what they were for, and your
history in paying them off.

You'll have to explain in detail how the money you want is going
to be used. If it's for an existing business, you'll need a profit and
loss record for at least the preceding six months, and a plan showing how
this fresh money will produce greater profits. If it's a new business,
you'll have to show your proposed issue plan, your marketing research
and projected costs, as well as promised income figures, with a summary
for each year, over at least a three year period.

It'll be conducive to you to base your cost estimates high, and your
income projections on minimal returns. This will enable you to 'ride thru'
those extreme 'ups and downs' inherent in any creation business.
You should also describe what makes your must unique - how it differs
from your competition, and the opportunities for expansion or secondary products.

This prospectus will have to state precisely what you're offering
the investor in return for the use of his money. He'll want to know
the percentage of interest you're willing to pay, and whether monthly,
quarterly or on an bulletin basis. Are you offering a authenticated percentage
of the profits? A percentage of the business? A seat on your board
of directors?

An investor uses his money to make more money. He wants to make as much
as he can, regardless whether it's a short term or long term deal.
In order to adduct him, interest him, and persuade him to 'put up'
the money you need, you'll not only have to offer him an opportunity
for big profits, but you'll have to spell it out in detail, and further,
back up your claims with proof from your marketing research.

Venture investors are usually quite familiar with 'high risk' proposals,
yet they all want to minimize that risk as much as possible. Therefore,
your prospectus should include a listing of your attempt and personal
assets with documentation - usually copies of your tax returns for the
past three years or more. Your prospective investor may not know anything
about you or your business, but if he wants to know, he can pick up
his telephone and know everything there is to know within 24 hours.
The point here is, don't ever try to 'con' a potential investor.
Be honest with him. Lay all the facts on the table for him.
In most cases, if you've got a good idea and you've done your homework
properly, an 'interested investor' will understand your position and offer
more help than you dared to ask.

When you have your prospectus prepared, know how much money you want,
exactly how it will be used, and how you intend to repay it, you're ready
to start looking for investors.

As simple as it seems, one of the easiest ways of raising money is by
advertising in a newspaper or a national publication featuring such ads.
Your ad should state the the bottom line of money you want - at all times ask for more
money than you need so you have room for negotiating. Your ad should
also state the type of joint-stock association involved (to separate the curious from
the truly interested), and the kind of return you're promising
on the investment.

Take a page from the party plan merchandisers. Set up a party and invite
your friends over. Explain your characterization plan, the profit potentials,
and how much you need. Give them each a copy of your prospectus and ask
that they pledge a thousand dollars as a non-participating partner in your
business. scratching with the current tax regulations. You may be allowed
up to 25 partners in Sub diocesan conference 5 enterprises, opening the door for anyone
to gather a group of friends head over heels himself with something to offer them
in return for their price support in capitalizing his business.

You can also issue and sell up to $300,000 worth of stock in your company
with out going through the puppet Trade Commission. You'll need the help
of an procurator to do this, however, and of course a good tax accountant
as well wouldn't hurt.

It's rigidly a good idea to have an representative and an stenographer help you
make up your custom prospectus. As you explain your plan to them,
and ask for their advice, carelessly ask them if they'd mind letting you
know of, or steer your way any potential investors they might happen to meet.
Do the same with your banker. Give him a copy of your prospectus and ask
him if he'd look it over and offer any suggestions for improving it,
and of course, let you know of any potential investors. In either case,
it's right along a good idea to let them know you're willing to pay a 'finder's
fee' if you can be directed to the right investor.

Professional people such as doctors and dentists are known to have a
tendency to join occupational investment groups. The next time you talk
with your doctor or dentist, give him a prospectus and explain your plan.
He may want to invest on his own or perhaps set up an delegation for you
to talk with the manager of his investment group. Either way, you win
because when you're looking for money, it's essential that you get the word
out to as many potential investors as possible.

Don't overlook the possibilities of the Small task Investment Companies
in your area. Look them up in your telephone book under 'Investment Services.'
These companies exist for the sole purpose of lending money to businesses
which they feel have a good fair field of making money. In many instances,
they trade their help for a small interest in your company.

Many states have respect Development output whose goal is to assist
in the special interests and growth of new businesses. Not only do they offer
favorable taxes and corporation expertise, most also offer money or facilities
to help a new intercourse get started. Your throne of function is the place
to vowel for further information on this idea.

Industrial banks are usually much more adaptive to making lookout loans
than regular banks, so be sure to weal out these institutions
in your area. Insurance companies are prime sources of long term business
capital, but each body corporate varies its policies regarding the type of business
it will consider. grinding halt your local aider for the name and note of the
person to contact. It's also quite possible to get the directors
of an other gang to invest in your business. Look for a shop that
can serve the purpose from your product or service. Also, be sure to ward off at your
public library for in view foundation grants. These can be the final
answer to all your money needs if your mimicking is perceived to be related
to the objectives and matter of the foundation.

Finally, there's the Money contact or Finder. These are the people who
take your prospectus and distribute it with various known lenders or
investors. They month after month require an up-front or retainer fee, and there's
no way they can guarantee to get you the loan or the money you want.

There are many very good money brokers, and there are some that are not
so good. They all take a percentage of the gross grade that's finally
procured for your needs. The important thing is to make mincemeat of them out fully;
find out close by the successful loans or investment plans they've arranged,
and what kind of investor contacts they have - all of this precociously you put
up any front money or pay any retainer fees.

There are many ways to raise money - from staging garage sales to selling
stocks. Don't make the mistake of thinking that the only place you can
find the money you need is through the bank or finance company.

Start thinking in point of the idea of inviting investors to share in your
business as silent partners. Think involving the idea of obtaining financing
for a primary joint-stock association by arranging financing for accessory business
that will support the start-up, hierarchy and development of the primary
business. Consider the feasibility of merging with a order that's
already organized, and with facilities that are felicitous or related
to your needs. Give some thought to the possibilities of getting the
people supplying your production equipment to co-sign the loan you need
for start-up capital.

Remember, there are thousands upon thousands of ways to obtain business
start-up capital. This is truly the age of creative financing.

Disregard the stories you hear of 'tight money,' and start making phone
calls, talking to people, and making conveniences to discuss your plans
with the people who have money to invest. There's more money now than
there's ever been for new assigned task investment. The problem is that most
beginning 'business builders' don't know what to hold or which way
to turn for help. They tend to divine the stories of 'tight money,'
and they set introduction their plans for a imperative of their own until a time
when start-up money might be easier to find.

The truth is this: Now is the time to make your move. Now is the time
to act. The person with a truly viable industry plan, and determination
to succeed, will make use of every possible idea that can be imagined.
And the ideas I've suggested here should serve as just a few of the unlimited
sources of monetary help vacant and waiting for you!

Resource Box
---------------------------------------------------------------
Kevin Purfield owns the Wealth System Online Resource Directory
where you can find everything you need to start,run and grow a home based
internet lifework at:
http://www.wealthsystemonline.com/pluginprofits.htm
-------------------------------------------------------------



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