Category: Venture Capital

Finding enough cash to get your small new business started or keep it running can be one of the biggest challenges you face as an entrepreneur. Here is a list of 8 different sources of business funding that can save your company’s future: 1. Friends and Family Before you groan at the idea of hitting up your loved ones for cash, you should know that friends and relatives are one of the most common sources for startups. No one knows you or believes in you more than this crowd. And they may be […]

One of the major aims of the Small Business Administration is to provide access to working capital for qualified new and growing companies. The SBA does not directly lend money to entrepreneurs however. In addition to its SBA loan program, it also offers a venture capital system called the Small Business Investment Company (SBIC.) Here’s what you need to know about this program: The SBIC was established in 1958 by Congress in order to get more financing to growing businesses. It allows […]

Venture capital is a buzz phrase these days among entrepreneurs. Young companies that have secured business funding from venture capital are seen as rising stars with great potential. And yet, while large initial investments can help a company get off the ground, there are plenty of reasons why bootstrapping may be a better idea. Here are the top three: 1. Autonomy There is no substitute for having total control over your business. It is your brainchild, after all. You are the one who is passionate […]

Whether you are a potential venture capitalists or a business owner looking for investments, understanding how a typical VC fund charges fees and expenses can help you be more able to navigate the venture capital waters. Management Fees Most VC funds charge an annual management fee, typically 2 percent of the fund’s total dollar amount. This money is paid to the fund’s management team in order to pay for all the overhead associated with running the fund: salaries, benefits, office rent and […]

No new business is devoid of setbacks and challenges. Even companies that go on to make millions of sales and find great success often make many mistakes in the early stages. While some business knowledge can only be learned the hard way, there are a few mistakes that can be avoided by learning from others’ experiences. Here are a three of the top financial mistakes to avoid as a fledging company: 1. Not Having a Cash-Flow Plan Becoming successful takes more than just opening the doors or placing […]

When your business is ready for that next round of funding, you might start looking for angel investors or venture capitalists to help finance your growth. However, the terms are not synonymous – even though they both contribute to your business funding, their motivations and roles are often very different. Here are a few of the main differences: Pay Schedule Venture capitalists (VCs) work for a group of professional investors who all contribute a portion of money to fund many projects. VCs […]

Entering into a relationship with an angel investor can be a huge business funding benefit to a new startup company. A large infusion of cash can go a long way towards purchases of needed inventory, machinery, employee salaries or any number of vital expenses for a growing business. However, angel investors come in many shapes and sizes. Each one is also motivated to invest by many different reasons. Discovering that specific motivation can help you decide if you are partnering with the right angel […]

Securing funding from a knowledgeable and generous venture capitalist is the dream of many a startup business owner. Actually making that deal happens very rarely in the real world. There are millions of new businesses each year and only a finite amount of VC funds. If you are hoping to woo some VC funding soon, the key is proving that your company stands out among all the rest. They will want to see numbers that confirm your claims of being a company with huge growth potential. One of the first […]

Acquiring venture capital can be a huge boost for a fledgling business or one ready to move on to the next level. Venture capital is notoriously difficult to obtain however and entrepreneurs are always eager for tips on wooing VCs. A recent study headed by Stanford finance professor Ilya A. Strebulaev got to the bottom of what matters most to venture capitalists when it comes to investing in a new company. The study call “How Do Venture Capitalists Make Decisions?” surveyed 885 venture capital […]

For young and rising companies in search of business funding, there is no one-size-fits-all option. Venture capital and business loans are two of the most desirable choices, but they are not equally beneficial choices in every situation. There are significant differences between when each is a good fit for a growing firm. Venture Capital Seeking out venture capital is best for businesses that are young but also have the potential to become huge both geographically and financially. Venture capitalists […]