Small Business Loans and Financing
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Business angels are wealthy individuals, usually entrepreneurs themselves, who are looking to invest in up and coming companies so can be a great source for business grants. These will buy a percentage of your business in the hope that the value of that percentage will grow as your business expands.
A business angel is a good source of funding for business grants for more established organisations, but be prepared to bargain hard for your money. They are battle-hardened negotiators and will want a large chunk of your business for as little money as possible.
Business angels and venture capital firms will expect plenty of access to your financial records in return for small business grants and will want to know all about your trading history, senior staff members and even your fixed assets, before they decide whether or not to invest.
The process of obtaining venture funding or small business grants from a business angel is a long and arduous one, so you must be committed to the idea 100% before taking the plunge.
Like business grants from a business angel or venture capital funding, floating on a stock market is a complicated process. Your business will have to be given the go-ahead by officials and you’ll have to tour the country, in the form of a ‘road show’, looking for people or organisations to back your business.
Your advisers will help you mould your business plan to make it appeal to investors, and once the money starts trickling, in a qualified registrar – also sourced by your advisers – will begin to document the investments.
Two relatively new services, AngelBourse and ShareMark, aim to take some of the work out of sourcing funding. They focus on smaller companies and have fewer rules and regulations.
However, if you’re a small company a small business grant may be better for you.
