Archive for

New Businesses and Angel Investment

A new business depends primarily on the management skills of the entrepreneur. The most successful entrepreneurs manage their resources by minimizing the amount of capital needed to start and grow their business. Angel investors want all of their investment put directly into making the business grow in order to insure a high rate of return, which should be about 20% to 30% per year on the invested amount. It is often a mistake among entrepreneurs to think that there are no competitors that operate in a similar capacity to their business, and this should be shown in your business prospectus as it relates to starting a company with money from an angel investor. Equity will almost always be required as a negotiating tool as it relates to working with a private third party funding source.

The details of how you will accomplish the goals of your business are described in your business overview documents. Entrepreneurs often have the misconception that a new business idea must be unique in order to be financed by an angel investor. However, this is usually not the case as the most important thing about your business is that it is economically viable. An expanded executive summary can be used to attract the attention of potential investors, and this should be shown within your new business plan.

Angel investors usually ask for less equity than a venture capital firm due to the fact that they require less capital and are less risky. We always recommend that you work closely with a CPA when you’re going through the very complex capital raising process. If it is investors you seek, do what you can to make the opportunity you present to them as attractive as possible. You may wan to find discussion groups for additional advice and support on business plan writing.

The ROI of your business should be more than 20% per year as it relates to working with a professional investor or individual funding source. An organizational business plan will be organized in a similar fashion as any other business plan as it relates to working with these individuals.

Writing a good business plan is one of the most important parts of raising capital as this will put all of your ideas for a business in a document that you can use to raise capital while also providing you with a guideline for how to expand your business. If you are uncertain as to how to put together a business plan specific for an angel investor or venture capital firm then you need to work closely with an appropriate adviser in order to accomplish this goal.

Turning Your Hobby Into A Business

You can start by selling your products at craft fairs or shows. This will give you a broader outlook and an insight whether your passion is good enough to set up a successful commercial business. When you participate in such events, you meet new customers, who help advertise your business and then you may assess your viability of initiating an independent venture.

The best part of starting off by showcasing your expertise is that it involves little cost and no overhead. The benefit of such shows is that you don’t have to invest a lot of money, and you don’t have to share your profits with the store or gallery owner. Word of mouth publicity is the best way to publicize your creations.

If you have the patience and dare to pursue your passion into a business, then there are 5 basic tips to success.

o About Your Work – Is your work ready to be exhibited and is it good enough for people to want to buy? Before thinking of starting a business, assess your quality impartially by attending shows and comparing your work with that of others.

o Venue - Before selecting a venue, always consult other artists. An indoor venue is perfect for paintings, but an outdoor craft fair may be fine for your jewelry business.

o Homework - Always conduct prior research because before starting a business you must understand your customers and their specific preferences. Find out about the people who attend such shows and what kind of turnout is expected. It takes plenty of insight to gauge and identify future customers. Depending upon the venue of the exhibition, enquire about the licenses required.

o Costs - While establishing your reputation and building a customer base, you should keep all your expenses under control. You should start off by borrowing or renting from another artist, instead of investing on your own. You can also share a stall. It is not a wise decision to invest your money before you know whether your hobby can be a good business venture or not.

o Customers - Reach out to your customers. Willingness to answer the customer’s questions and maintaining a smile on your face always can take you a long way and earn your business new clients. Always be ready to talk to people and permit them to handle your merchandise and also check your work quality. Shows provide you with a major customer database, which you can use later. You can collect the mailing addresses and then send the customers invitations for your next shows.

You should never be disappointed if your first show does result in high profits. You should be satisfied meeting a lot of people and generating an interest among them about your work. This is the first step towards building a clientele for your business venture.

How to Find Good Investment Property

The topic that will be explained in this article is the way to find good investment property. Owning rental real estate seems to be more and more popular as investor tire of the swoops and swoons of the stock market. As for our information, not everyone has what it takes to be a landlord. But those who do may find out that rental will be a good way to build wealth. After we have decided to buy rental property, our real work begins. To find a profitable rental property usually takes a long time, connections and plenty of research.

To find good investment property, we need to know our time horizon. As it is the same as any other investment, we must have a plan or idea on the period we want to own a rental property before we buy it.

The longer the period we plan to own the property, the more we’ll probably need to invest in maintenance, improvements and repairs. If we’re keeping it for 20 or 15 years, at some point, it means that we will be putting a new roof on that property. In addition, we will be putting in new appliances and doing some major repairs. If we are only planning to own a property for four or five years, by contrast, we will probably want to avoid making any major improvements unless we are confident that we can recoup the cost with a higher sale price.

There will also a greater risk that we will face within a shorter time horizon. Although our rental will almost certainly appreciate over 15 years, but it could easily lose all the value in the following next five, especially if we are buying in an overheated market. We will need a higher amount of potential annual return to make up for that risk.

As for small investors, they might prefer long-term ownership. We will have plenty of time to achieve great result in the market, and rental income can make a nice supplement to our day job. Find more rental properties, and being a landlord may become our daily job.

Lastly, we need to develop a network. Landlords that have greater experience might find their properties in a variety of ways. Some of them will hunt for foreclosures, making friends with bank employees and city hall clerks or who has information on which properties are about to be sold. Some of them run promotion in local newspapers. Meantime, others might work with real estate agents that keep their eyes peeled for possible buys. Some of the landlords might be joining a local landlord and property owner’s association to make contacts and good relationship. It is believed that when we begin to own rentals, all the other investors start coming out of the woodwork.