How to access capital for your business
Do you have a great start up business idea or run an established business which needs a capital injection in order to grow?
Well the good news is that there are plenty of options for raising capital or achieving a partial or full sell down of equity.
At a high level we have grouped the major funding or exit strategies into several main categories as depicted below.
Without discussing each of these strategies individually (which is way beyond the scope of this article) it is important to recognise that each strategy is best employed for particular situations and at differing stages of the business life-cycle.
Secondly, it is important to recognise that each funding or exit strategy has its own unique accompanying risks and benefits as well as associated costs.
Thirdly, the chosen funding or exit strategy must align with the overall strategic objectives of the business or the exiting owner. For example, you may not want to give away equity during the early growth phase where debt funding was immediately available and easily serviced. Alternatively you may decide that accessing seed capital to fund your start up enables your business idea to be first to market and therefore your preferred funding strategy.
Most importantly - BE INVESTOR READY.
Accessing capital via any one of the above strategies requires the business to be investment ready. Banks, good friends, angel investors or strategic buyers will not invest into or acquire your business without them firstly being convinced that:
A - They are not paying too much for the opportunity;
B - They will get their money back one day; and
C - They will get a return on their investment;
BSP Strategic assist small business owners to access capital through many of the above funding and exit strategies and specialise in assisting business owners to maximise value, become investor ready and pitch for the funds.
Please contact Haydn Erbs to discuss your options further.