Raising Capital Part 1.
The best piece of advice I ever received this year was from
Graham, an experienced Capital raising Guru from Australia. He has over the years helped startups and
companies deal with this troublesome point in a business. He has written a book
in this topic; what he has learned over the years to help you get funded.
The first conversation we had, I could keep to myself but I
thought of sharing:-
“I'll be honest
with you. The amount you are seeking as seed capital is very much smaller than
the sums my clients are used to hearing about from me. Tell me, do you have a
written business plan and budget. In particular, does your business plan
include your growth or expansion plans. Why
this may be important for you is this.
I have been involved with startup companies where we have gone
into the capital market with a business plan that is based, for example, on a
capital raise of $1 million. However, the business plan is split up into a
series of action plans each based on a tranche of capital, Say the first tranche
is for $50K to do certain things. When that is achieved, we activate the next
tranche, which could be for $150K to do the next lot of action. That completed,
the third tranche is activated.
The reason that I am telling you this is that there are two benefits
for you here. The first is that investors like these types of arrangements
because it helps them plan their own cash flows. Investors use money as a tool
of trade. They don't leave their money in a bank account or under their
mattress. No, their money is always working in some investment. So if the
investor likes your project and sees that you have a structured capital raise
based on achieving benchmarks or milestones, then they can plan to give you
more funds at expected pre-determined times.
From your point of view, you have committed investors for the
long haul and provided you keep reaching your milestones, you are assured of
funding.”
Read more about raising capital or Contact Graham.
Author of the 350
page, 29 chapters eBook:
'The Venture Capital MasterClass:
'The Venture Capital MasterClass:
everything you always
wanted to know about raising equity capital ... but until now, you had no one to ask'.
Buy your PDF copy now
at http://chironthebusinessdoctor.com/downloads/the-venture-capital-masterclass-ebook/ for an affordable investment in your future
of $USD 49.50.