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SMALL AND MEDIUM BUSINESS INCORPORATING TECHNIQUES TO RAISE CAPITAL

Guest post by: Jayson Curuso

Article Overview: Up to now funding for start-up and small business is practically non-existence other than if you want to count a Small Business Administration (SBA) loan, good luck with that. The following are recommended techniques for financing your start-up or small expanding business. First we start by making a practical and factual statement. That statement is simply that there are no free rides, i.e. do not expect to take advantage of someone else’s resources without paying fees.

SMALL AND MEDIUM BUSINESS INCORPORATING TECHNIQUES TO RAISE CAPITAL

Up to now funding for start-up and small business is practically non-existence other than if you want to count a Small Business Administration (SBA) loan, good luck with that. The following are recommended techniques for financing your start-up or small expanding business. First we start by making a practical and factual statement. That statement is simply that there are no free rides, i.e. do not expect to take advantage of someone else’s resources without paying fees. This is not to say you should be willing to pay up-front fees to someone making promises without hard evidence to deliver the product or services to help you obtain financing. But like the services of any other professional, Attorney, Doctor, Accountant, Plummer, etc., there is nothing like the services and advice of an experienced and ethical financial professional. The type of fees I am referring to are fees for the necessities of building and incorporating a business. Many small business owners are not aware of the advantage of Incorporating their business and will operate as a sole proprietorship which hinders raising funds and is risky for law suites should they occur.

Incorporate your business; The way to hit the ground running is to incorporate your business and or acquire an existing seasoned corporation, (two to three years old shell corporation) then prepare your financials based on a more seasoned corporation. This is not a guarantee that you will receive funding but will give build a higher level of confidence in your company when approaching lenders or Investors for funding. Is it lying to use a seasoned (shell) corporation? Of course not, after all the corporation is based on the business owners experience, and many times the business owners will already have between three to five years experience in the business and is simply leveraging his/her experience which he will use to lead the corporation. There are shall corporations for sale that have already established lines of credit that can go up to one million dollars. The older the corporation the more it will cost, the larger the line of credit the more it will cost. A three year seasoned corporation can cost up to $5,000.00, a corporation with a one million dollar credit line can be expensive as well. If you are an established business minded person think creative about securing funding for your corporation. Start by using the resources that are available to leverage your way up the ladder in your search for financing. Use the resources that are available, like your credit cards, friends, some have used the equity in their home or auto. Being in business for yourself depends on the following; are you a risk taker and how much risk are you willing to take, having a high level of self confidence in yourself and your products or services, how much are you willing to sacrifice to fulfill your dream of owning your very own business. Theses are new and trying times but with this comes many new business opportunities. The best advice is to be ready to take some risk and incur some cost in these endeavors, but “always” conduct a careful review and due diligence before paying out any up-front fees by asking for references and the number of years they been in business and number of companies they have successfully assisted.

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Article Tags: capital, funding, loans



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