The first step in finding a funding & investors profile for your business is to identify those that are willing to invest in your business. This can be accomplished by carrying out a search on Google, Yahoo or MSN and searching for different business types. This will give you a list of potential funding sources. When carrying out this search you will also need to define the type of investor that you are looking for.
There are many different sources of capital that can be used for your venture. Some sources are investor relations groups, venture capitalists, private equity funds, banks, equity firms, mutual funds and registered investment companies (RIA). You need to carry out a comprehensive search for each of these investment groups so as to identify which of them may be able to fund your business startup. You can also use investment companies in your area to identify funding options for your venture.
Once you have identified potential funding sources it is time to identify the different investors that are potentially willing to fund your business startup. This process is relatively easy to do. You need to identify potential investors that have the same passion and ambition as you have regarding your business. You should also make it clear to these investors what type of capital that they can provide for your venture.
As with the case of investors in general, there are specific investment categories for different categories of investors. The best way to identify potential capital funds is to create a spreadsheet that will help you track the investment activity for each of the categories. In addition, when identifying investors use the same spreadsheet to identify potential joint venture partner(s) or other investors that may be willing to finance your business. You should also work closely with a funding company to determine if there are any other direct investors from your area that may be willing to finance your venture.
Once you have identified potential funding & investors it is important to establish the terms of the relationship. Most funding companies offer a default agreement that outlines the terms of the investment. This should be reviewed and discussed with your investor before you begin negotiations. If an investor is going to provide capital funds you will need to determine what percentage of the capital is going to be paid out to you as the investor and what percentage is going to go to the investor’s partner or group. This is something that is going to vary according to the type of capital funds that you are looking to raise.
When you are ready to enter into funding discussions you should have a well drafted, comprehensive written contract that details all of the terms of the investment. The contract should also include the terms of payment terms and should clearly define your exit from the deal once it is complete. It is important to use a funding company that will work with you during the entire process of raising capital and will not try to steer you in one direction when the final investment decision is made. A good funding company will be willing to work with you to find the best financing options for your business.
