A financial planner is a professional who would put together a financial plan for you to help you achieve your financial goals. Before considering a financial planner, it would be good to examine if you really need a financial planner. As you grow older and your income increases and your list of goals become bigger, it would be prudent to engage the services of a financial planner. Even if you know the basics, it would be worthwhile to have sound advice from a professional. While the fee may appear steep, it becomes sensible when you look at the purpose for which the money is being spent.

Some planners confine their services to drawing up a financial plan without getting into execution whereas others do both. There are merits and demerits to both these approaches. Let us look at a few important features that you need to consider when you choose your financial planner.

Relevant credentials:

The plan should be made by a certified financial planner with the relevant experience and qualification to render appropriate advice. Given the plethora of people you encounter ranging from your stockbroker to your tax consultant and the friendly banker, you need to be able to distinguish a financial planner from the rest.

No obligation service:

There should be absolutely no obligation to buy any products from the planner. This will eliminate any conflict of interest that may exist as the planner will suggest products that are beneficial to you and not look at his/her commissions. Planners who charge a fee for their services are likely to provide unbiased advice compared to ones who earn their income primarily from commissions.

Ability to provide a comprehensive plan:

The plan should address all areas, ranging from your short term goals, life goals and your retirement and insurance needs.

Customised and confidential service:

The planner should meet you exclusively in a place convenient to you, to collect the required information and subsequently render personalized advice when presenting your financial plan.

Large players versus individuals:

Large firms claim to bring structured processes and systems which ensure consistency and standardization. However, as a customer if you are sure about the quality of service from smaller players, you can go ahead and engage them as quality is not dependent on size. Also, larger players may have a vested interest in pushing mutual funds and insurance products from those providers who are affiliated with them. And smaller independent financial advisors can provide more personalized service. Another big advantage with smaller players is that you engage with the same person throughout, as opposed to larger organizations where the individual may take up a bigger role. When it comes to executing a financial plan, a larger organization would score better, given the kind of access to resources that they would have.

Summary:

It is also important that the planner should be able to provide you with testimonials or show his/her track record. At the end of the day, given the important role played by a financial planner, it is worthwhile to spend time and do appropriate due diligence before engaging with a planner. You can check out the National Association of Personal Financial Advisors (NAPFA) to locate planners.

Author Bio: Christopher is a full time blogger and part time financial counselor. He has invested his time and energy in producing quality information for ISA Rates and its subsidiary blogs. He is a passionate finance professional who wants to reach out to a large audience through web and media.

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Starting your very own small business can be a very exciting and very stressful time.  Even before the doors open, a massive amount of work needs to be done to ensure the business is successful right out of the gate.  Too many small businesses fail because they’re unprepared with initial costs and one of the ways to ensure any small business is getting the best bang for their buck is by owning a small business credit card.

Most small business credit cards are geared toward two types of rewards programs; travel and cash back.  Here’s a look at the ten top small business credit cards available to business owners today.

The Plum Card® from American Express OPEN

My personal favorite, the Plum Card from American Express OPEN is a charge card which simply means that a small business owner has no pre-set spending limit.  This also means the card has no interest rate so purchases are due in full every month.  As an added bonus, if you pay 10 days early each month, you’ll receive a 1.5% discount, effectively providing you with a 1.5% cash back rate.  There is an annual fee of $185, but it’s waived during the first year.

Ink Cash(SM) Business

The Ink Cash Business offers the biggest up-front incentive on our list, giving new cardholders a $250 cash bonus after they spend $500 in the first three months.  5% cash back is earned on office supply, cellular and cable services, 2% cash back is earned on gasoline and restaurant purchases and 1% cash back is earned on all other purchases.  There is a limit of $25,000 spent annually that triggers the 5% and 2% cash back categories (so once you’ve spent $25,000 in gas and at restaurants, you’ll earn 1% for the remainder of the year) but this card also includes a 0% intro APR on purchases for six months AND does not charge an annual fee.

The New Business Gold Rewards Card® from American Express OPEN

Another one of American Express’s line of charge cards, the new Business Gold Rewards Card from American Express OPEN dishes out rewards points in tier levels.  3x points on travel purchases, 2x points on gas, advertising and shipping purchases and 1x points on everything else makes for a very solid rewards program.  There is a hefty $175 annual fee which is kindly waived during the first year and every small business owner can expect the full line of AMEX perks.

Capital One® SparkSM Cash for Business

A fairly new credit card, the Cap One Spark Cash for Business is a no-nonsense small business card offering 2% cash back on every purchase.  New cardholders will also earn a $100 cash bonus after spending $1,000 in the first three months with another $50 cash bonus coming after an additional employee is added to the account.  The $59 annual fee is waived during the first year and this card includes a very low 13.9% variable APR.

TrueEarnings® Business Card from Costco and American Express

The best card on our list for the local traveler, the TrueEarnings Business Card from Costco and American Express offers 4% cash back on gasoline purchases (up to $6,000 spent annually), 3% cash back at restaurants, 2% cash back on travel and 1% cash back on everything else.  The 1% cash back includes at Costco and there is no annual fee so long as your Costco membership is paid every year.  Cardholders will also find a 0% intro APR on purchases for the first six months.

Bank of America® Cash Rewards for Business MasterCard® Card

Another great cash back business card to fill out our list is the Bank of America Cash Rewards for Business MasterCard Card.  Cardholders will earn 3% cashback at gas stations, office supply stores and for computer network services, 2% cash back at restaurants and 1% cash back on all other purchases.  There is no annual fee to own this credit card and it comes with a 0% intro APR on purchases for the first nine months.

The Business Platinum Card® from American Express OPEN

The most powerful of business credit cards, the Business Platinum Card from American Express OPEN provides its members the best perks any business card can.  Complimentary airport lounge passes, an annual $200 travel reimbursement and 24-hour concierge service are just some of the things every business owner will receive when owning this charge card (remember, payment in full every month). The big downside to having this power and prestige is a $450 annual fee.

Capital One® SparkSM Miles for Business

Similar to the Spark Cash card listed above, the Capital One Spark Miles for Business offers double miles on all purchases.  10,000 bonus miles are provided to businesses that spend at least $1,000 in the first three months of card ownership and another 5,000 miles are awarded when an additional employee is added.  A $59 annual fee accompanies this travel themed small business card but Capital One will not charge it for the first year.

SimplyCash® Business Card from American Express OPEN

The least expensive American Express business card to own; the SimplyCash Business Card from American Express OPEN provides cash back on every purchase.  It’s earned based on purchase categories; 5% cash back on office supplies and wireless services, 3% cash back on auto gasoline and 1% cash back on everything else.  Cardholders can save an additional 3% – 10% on select merchants like FedEx and Hertz and are also offered a 0% intro APR on purchases for 12 months.  This card is annual fee FREE.

Capital One® SparkSM Classic for Business

The last but not least card to make this list is the Capital One Spark Classic for Business.  This is actually the small business card I own, and I chose it because my credit score would be classified as below-average to average.  The card offers 1% cash back on all purchases and does not have an annual fee.  The upside is that it’s perfect for a small business owner with less than excellent credit … the only card on our list which is offered to mid-600 FICO score consumers.

About the Author: Founded in 2004, CompareCards.com is an online resource that provides expert reviews, tips and tools to find and compare credit cards.  Visit CompareCards.com today and review the credit card deals that fit your lifestyle and/or current needs.  

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Every small business dream begins with the simple idea of making money while providing a needed product or service. As businesses evolve, their proprietors quickly learn that the product or service isn’t where all the effort is; tracking, managing, and even getting the money all take their fair share of work as well. While financial management can (ironically) be costly if you don’t have the right tools, there are plenty of free resources to help organize your business’s income, saving time and money. Keep your business on the right track (and out of debt) by taking advantage of these 4 free tools: 

Mint

One of the most popular free finance tools is Mint.com, an online application that allows you to manage all of your financial accounts in one place. The clean, streamlined interface makes it easy to use, giving this tool major brownie points. Mint works automatically, pulling information from your checking, savings, investment, and retirement accounts, and displaying it visually with handy graphs and charts.

Beyond account monitoring, this tool helps you set a budget and financial goals, making it a valuable asset for any small business. The icing on the cake is Mint’s mobile device support and integration, enabling finance tracking on-the-go.

Sage Billing Boss

Who said invoicing had to be complicated (or costly)? This feature-rich invoicing system allows you to organize customers, track payments, and even collect money. You might be expecting a customer limit or an upgrade fee hidden somewhere, but all of Sage Billing Boss’s features—including unlimited invoices and customers—are completely free.

Built especially for small businesses, this tool integrates handy options like recurring invoicing, online payment tracking and quotes. If you’re looking to get organized and save time on small business invoicing, Sage Billing Boss might be all you need!

Google Wallet

Previously Google Checkout, this tool serves as a virtual wallet that securely holds your payment information for faster purchasing and better tracking. Google Wallet helps make light work of online purchases, storing your credit card and billing information for easy access when you pay through a merchant’s Google Checkout button. It offers fraud protection and even helps keep your email address confidential, keeping unwanted emails at bay.

Google Wallet’s latest feature is the ability to make purchases in-store using its mobile app; just tap the phone on participating credit card devices (at the time of this writing it only works with the Nexus S 4G phone).

Moneytrackin’

The key to staying organized is keeping relevant information together in one simplified location. That’s what Moneytrackin’ promises to do with its free online app. Keep tabs on income and expenses on all of your accounts, tagging transactions for easier grouping. If more than one person is involved with your business’s finances, you’ll appreciate the collaborative working capabilities this tool offers, including budget-sharing. This may not be as robust as Mint’s application, but it offers a clean-cut solution to organizing and keep track of your company’s finances.

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About the Author: Chris Turberville-Tully is a marketing strategist for Personal Touch Debt Solutions, a debt management company providing personal security, debt payment plans, expert advice and more.

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Photo Credit: Images_of_Money

In a down economy, it’s difficult for entrepreneurs to access the capital needed to build their venture from the ground up. Luckily, projects can now be funded by a powerful combination of the social Internet and generous networks of friends, colleagues, and communities. This model is called “crowdfunding” and is sweeping the startup nation by storm. It seem s to be an entrepreneurs dream,. bit are there problems in the way?

Check out the below infographic on how to navigate the new crowdfunding landscape (click image for larger view).

Click for Larger View

infographic source: drawing a crowd

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Anyone who is in business is usually trying to stay afloat in this recession and concerned about keeping costs to a minimum.  Running your business income through your personal account may seem like a great idea, however, there are some things you should be aware of.

Income Taxes:

Keeping your business income and expenses separate is a must come tax-time.  Being religious about keeping these separate will make life a lot easier down the road.  If it isn’t a business expense, then you won’t use your business checking. Simple as that.  Business is for business, personal for personal and never shall the two meet.

Figuring your profit and loss, balance sheets and tax returns will be a breeze, especially if you use accounting software such as Quicken to track your business checking account.  Everything is automatically put into the right categories for you so you can examine monthly, where your biggest expenses are, and where you can minimize expenses.

Better Money Management:

Having a business account helps you budget, because if you don’t use it for personal reasons, there tends to be funds left over at the end of the month.  You can transfer from business to personal when needed, and even that is a write-off.  Everything that you run through your business will become a business income or expense and therefore much easier to see where your hard earned cash is going.

Professionalism:

The more you act like an established business, the more you will be perceived as a successful business.  Having a business account will allow your clients to perceive you as a professional.

Having a business account, business cards and a professional answering service will give you a means of business credibility and representation, as well as give you the confidence to land more clients.

Business Account Uses:

When you open a business account, money can be allocated for investments, partnerships and make business payments, keeping your business credit optimum.  If you have employees, paying salaries from a business account is mandatory, especially if you have a corporation, or LLC.

Business Account Benefits:

Business accounts at major banks offer benefits such as special discounts on business products, and special promotions.   And, there are perks such as sub-accounts, direct and free connections to personal accounts, the ability to obtain better rate credit cards and financial rewards.

Type of Business Account:

Each financial institution is different, however, there are many choices that should be considered when opening an account.  How many checks do you write, how much income is run through the account monthly? What is your average balance monthly?  These are things that should determine what type of account you choose.

There are small business accounts, which offer new and smaller businesses a business account with no fees.  Some accounts offer no fees if you keep a specific balance or a specific amount of checks are written, so make certain you look closely at the options.

Risks Involved:

The times when business is slow, finding yourself with insufficient funds can cost you a fortune with a business account.  The fees are escalated, which makes matters worse, and your business associates could lose confidence.

Also, because you have a business, banks tend to see you as credible and offer you business loans, especially if your credit is worthy.  These loans can escalate when times are slow, and end up costing you more than you make just paying them back.

Disadvantages:

Usually, interest-bearing accounts offer less interest on business checking than a savings account.  And, there are fees associated with a business account that are not charged with a personal account or savings.

• Overdraft fees and interest rates are higher for businesses.

• If your credit is iffy, your ability to get a business account may be jeopardized.

• Opening a business account requires a lot of paperwork, and the approval process is sometimes tedious, and time consuming.

Conclusion:

Essentially, the benefits outweigh the disadvantages, and having a business account is sometimes a necessity in keeping your accounting straight, your tax information handy and to allow the clients you work with to see you as much more worthy when writing checks made out to your business, instead of you personally.

Business accounts lend credibility, especially to a new business.
About the Author: Ally is part of the team that manages How To Save Money, a personal finance blog that wrote about How To Save Money On Your Food Indulgences. Before joining BS, she was a Media Planner with McCann Worldgroup Philippines, Inc., with award-winning executions, including the Levi’s 501 “Live Unbuttoned” global campaign.

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Many new businesses fail during the raising capital stage because of a lack of proper documentation.  This is due to many factors but the most likely are unprofessional marketing materials.  The following fall under that category and are key to getting start-up funds:

Business Plan

Private Placement Memorandum

• Investor Presentations

Since all of these three factors are extremely important when pitching to investors, it can be noted that if they are unprofessional then they will be rejected. 

Private Placement Memorandum

A Private Placement Memorandum is a necessary part of the documentation that new business owners must present to investors.  However, a vast majority of new business owners don’t have a clue as to the details of preparing such documentation.  Unfortunately, this lack of knowledge will keep you from being able to raise capital.  Therefore, this article is designed to help answer some of the questions surrounding the Private Placement Memorandum.  Hopefully, this will allow you to avoid some of the common errors.

Hiring a PPM Author

Honestly, it’s best to hire a professional to write your Private Placement Memorandum if you’re new to the idea.  Just be careful not to hire the wrong person.  In this field, cheapest is not usually the best way to go.  Finding the cheapest PPM author is one of the biggest mistakes made by beginners.  It usually goes like this: the owner hires the cheapest author and then wonders why they can’t get an investor to fund their 60 or 70 page stack of papers.  The reason is that there are different PPM for different investors.  You have to do your homework, obviously the cheapest man on the market is not gonna do that.     

What Does a PPM Do?

The use of a PPM is different, depending on what type of investor you are preparing it for.  Therefore, it’s best to go into both types in greater detail.

Venture Capital Firms

A Private Placement Memorandum for Venture Capital Firms must be written in a more equity control and technical language as this is the ears that the report is most likely to fall on.  With this type of firm, you want to offer them a shareholder’s dream.  You’re offering them discounted stocks and within a year, once you go public, the ability to sell these shares to the public for a 4 to 5 times profit. 

Angel Investors

A Private Placement Memorandum for Angel Investors must be written in a different tone.  Since Angel Investors normally have portfolios worth less than a million dollars, they need to get in and out of transactions much faster than Venture Capitalists.  Therefore, you need to promote what is known as “selling shareholder offering”.  

Now it’s easy to see why it’s a good idea to know who you’re pitching to before preparing a Private Placement Memorandum.  In fact, it’s a critical mistake to prepare this documentation before researching your target investors.  And this is one of the biggest mistakes of new business owners.  So now, maybe you can keep from making this one mistake that could cost you your business!   

About the Author: Gary Trump has been raising capital for over 20 years. In that time, he has gained a huge amount of knowledge about raising capital. As a entrepreneur , it is his goal to see that all businesses have a chance to grow, and he is  sharing his knowledge with you, free of charge. For more information on Business Financing please visit Gary at www.freecapitalraise.com

Photo Credit: photosteve101

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I’ve recently been looking into getting some investment in my company. I don’t need a massive amount of money, just a bit of financing to accelerate certain marketing activities. However, as the millionaire and poet Felix Dennis once wrote, making profit is all about “equity, equity, equity”. He was loathed to ever give away any percentage of his company and so am I.

This got me thinking though, where can I find money that won’t put me in big financial risk and won’t force me to give over equity. Here are four of the best places I came up with, but I would love to hear examples of others if anyone knows any?

Friends

I once read that you should never lend a friend money if you are expecting it back. That is to say the amount you lend them should never be more than you would give them anyway. Whilst it’s true that lending friends money can open up a massive can of worms, I don’t strictly agree with this sentiment. It of course depends on the amount of money in question and how close friends you are, but I certainly think it is acceptable to give and receive loans from friends. I always pay friends back a little more than I borrowed as a way of saying thank you and ensuring they are not at a loss (interest wise) for lending me the money.

Family

Unlike my friends, I hate asking my family for money. I don’t know whether it’s because I want to appear self sufficient to them or I’m afraid of being turned down, but whatever it is my family is usually last on the list of people to ask. This is of course foolish as pride should not stand in the way of progress and actually family is a very good place to get finance from. Not only are they likely to be more understanding should you delay in paying them back, but it’s also often very rewarding for the family member/s to feel like they are helping you and your business out. On the rare occasions I have received money from a family member, it has given us more to talk about when we meet and actually brought us closer.

Credit Card/Loans

Now these you have to be very careful with. Getting credit cards and loans to finance business expenses can mark the beginning of a long road to debt and despair. Having said this, many people rule these options out far too soon and they can be very effective if managed correctly.

The first thing to think about is can you manage the repayments? If you are speculating your investment and relying on this to enable repayments, it’s best to look else ware. If you have steady money coming in however that can cover the repayments, this could be a great option. The second thing to consider is your credit rating. If you have a poor credit rating then you might only be able to get credit cards and loans that have high interest rates and this is where the danger lies. The larger your repayments and the higher the interest rates, the bigger the risk to you and your company. However, if you have a healthy credit rating, you should be able to qualify for one of the many interest free credit cards or low interest loans that are available. Some credit card companies are offing 18 months interest free right now, and so this is a great place to find money for your company with very low risk indeed. Just make sure you always pay at least the minimum repayments.

Overdraft

Not many people consider their overdraft as a viable source of money, but I can assure you it is. I first started using my overdraft at university when my bank kindly gave me quite a large interest free facility. This is not uncommon and can be used as a great source of extra money with little risk. I’m not saying be reckless and rely on your overdraft all the time, but used at the right time it can make perfect financial sense. Now that I am no longer a student I don’t have an interest free overdraft, but have found that the interest I now pay is much lower than most credit cards and loans anyway, making it a great source of money still.

Just a word of warning with this one though – You don’t want to hurt your credit rating by using your overdraft too much . Most banks are happy for you to use it, but it’s best to check with them first about penalties and the impact on your rating. Be careful with your overdraft limit as well. Whilst overdraft interest rates are usually low, banks often slap you with a big charge if you exceed it.

About the Author: Duncan is a the owner of a surf clothing company that compares prices on anything from mens backpacks to girls board shorts. He’s been in business for a few years now, but is still learning every day.

Photo Credit: the.serial.chiller

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At some point you may be thinking about raising additional funds for your business to grow and expand. If that’s the case, you’ve probably thought about venture capital as one source of those funds.

Not only is venture capital tough to get, but pitching to a VC can be intimidating – but it doesn’t have to be. Here are five great tips from an actual VC who explains what it takes to make a good pitch and give yourself the best chance to get the money.

Tip #1 – Every Step is to get to the Next Step

Every time you communicate with a VC your goal should be to get to the next step. No overkill – sure you want to share mountains of data with them right off the bat, but instead you should be looking just to get a meeting. Instead of overwhelming them, think in steps – and at first it goes introduction, then meeting, then pitch, then money.

Tip #2 – When you Get the Meeting Be Succinct

You may get an hour meeting, but it won’t be for an hour. Huh? True, they may give you an hour, but when you factor in somebody being late, cell phones ringing, or other technical issues, your 60 minutes will more likely be 15-30. Create your pitch with that timeframe in mind. If you get done in 15 minutes, great then you have 45 minutes to answer questions. Much better than banking on 60 minutes and winding up with 10.

Tip #3 – Get to the Value Proposition in 5 Minutes

VC’s want to hear what you can do, what value your idea/business brings, and do you have credibility. The quicker you can demonstrate this the more likely they are to keep listening. VCs by nature have short attention spans, if you’re not telling them something interesting they’ll quit listening.

Tip #4 – Keep the Overall Pitch Short

You should be able to clearly articulate your message in 20 minutes. If you can’t get it down to 20 minutes rethink your pitch or rethink who you are pitching to. These VCs should be pre-qualified to your industry so don’t waste valuable time trying to “bring them up to speed” on fundamentally what you do. They should already have a general idea of what your business does, if they don’t they are the wrong VCs for you.

Tip #5 – Control the Meeting

May sound hard to do, but you need to keep control of the meeting. You come in and tell them “I have 20 minutes and 10 slides, bear with me and we can talk at the end”. You have the podium and the audience, don’t let that control slip away. Your goal is to get through the meeting, without getting off track, so that you can get them all of the information they need about you and your business in order to make a decision.

Heidi Roizen – Mobius Venture Capital

Photo Credit: Tracy O

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Friday 10/10/2008

• 
  AlzayCalhoun: @SmallBizBee That is real simple. I wished someone had told me to build a list. An email list. If done correctly, it is a huge asset to any company online or off. You create your own biz community.

• 
  PamperingU: @SmallBizBee 2. Wish I had done more research on stuff like…the cost of advertising/marketing & other professional services, ouch!

• 
  tessneale: @SmallBizBee don’t care to much about what others say, do your thing & TRUST your gut feeling. don’t let the ‘calamity-howlers’ bug you!

• 
  PamperingU: @SmallBizBee 1. I wish someone had prepared me for the lack of interest and support from family and friends…shocking, I tell you…LOL

• 
  eclewis: @smallbizbee never swear in front of or to anyone no matter how mad (when in sanctity of your own home, all bets are off through!)

• 
  bebizzy: @SmallBizBee That you don’t have to do it all yourself. Outsourcing can be a good thing.

Unless you are blessed with a goose laying golden eggs, you will inevitably be faced with a need to finance your small business. Whether it be a small business loan, a loan from friends and family, or by using angel investors and venture capitalist, you will need cash to get your business up and running and to help it grow. Finding the money your business needs may seem like a daunting task, but with a little planning and resourcefulness it should be easier than finding that magical goose.

The very first question you must ask yourself is how much money do you need?

Need $0-$25,000

At this level you are best off looking to friends, family, or some micro-loan programs, such as Prosper.com (disclaimer: I have no affiliation or financial incentive to mention Prosper). You’ll get your best interest rate from your friends and family (My mom loaned to me at a very favorable 0% rate), but even at a lending site like Prosper.com you can fill loans up to $25,000 for some very competitive rates if you prove you’re a worthy borrower (meaning your personal credit is in order) You may also want to work with the bank where you do your personal banking and inquire about personal loans or small business loans.

To rank your options in the $0-$25,000 category from easiest to obtain to hardest and from least costly, in terms of interest, to more costly would look something like this:

• Family
• Friends
• Prosper.com or other micro lending site
• Bank/Credit Union
• Credit Cards

Need $25,001-$200,000

In this range you’re going to have to start getting more serious. Not that you weren’t before, but unless you have a rich uncle you will be dealing with banks and other larger lenders who will want to see business plans, financial projections, marketing plans, and anything else that will put their mind at ease about lending you money. In this range you are an “in betweener”, you’re needing more capital than you will probably be able to raise from friends and family, yet not quite to the level that an angel investor or venture capitalist would be interested. Small business loans at your bank or credit union are a viable option, as well as small business loans through the Small Business Administration. Also there is nothing saying that you can’t get a loan for a portion of what you need from the bank or SBA, and the rest from friends, family, etc. Another option depending on your personal financial situation would be home equity loans, but that really is a personal decision as to whether you want to put at risk that equity. Rates can be favorable depending on your credit score, the size of the loan, and the amount of equity in your home.

Again to rank your options in the $25,001-$200,000 category from easiest to obtain to hardest and from least costly in terms of interest to more costly would look something like this:

• Bank/Credit Union
• Small Business Administration (usually rates are prime plus 3-4 points on loans in this range)
• Home Equity Loan

Need $200,001 – $500,000

Your options open up even more here, but you will have to work a little harder to get this money. In this range you still have the option of the SBA loan programs (usually those programs have a maximum loan amount of $2,000,000). If your business plan is sound and the outlook for your company is promising, you should be able to attract the attention of angel investors. Angel investors can be a great source of funding if you can find them. DO NOT just Google “angel investor” and start sending your business plans to whomever you find there. The best way to get your business and plan in front of these angel investors is through good old fashioned networking. Try joining a local small business networking association, or look for a local chapter of the Angel Capital Association. Also your bank may have resources to put you in contact with these people.

Remember also, that when dealing with angel investors you are more likely going to be trading availability to capital for a share of your business. You typically won’t be dealing with groups or individuals who are happy with just loaning you money and charging an interest rate while you pay it back. They will most likely want an equity share in your company as well as some oversight in how your business is run. Your angel investor may only want to chime in on big decisions, or they may want to take on some of the day to day operations. Be ready for some of the lost control in exchange for the money you need to grow your business.

To rank your options in the $200,001 – $500,000 category from easiest to obtain to hardest and from least costly in terms of interest to more costly would look something like this:

• Small Business Administration
• Angel Investor

Need $1,000,000 or more

Congratulations, you and your business have reached the big time. If you’re looking for this kind of money your business is growing, or there is real potential on the horizon. Now you just have to find the cash! In the million dollar plus range you will most likely be dealing with venture capitalist (or VC’s), who you will find much in the same way as angel investors, through networking or contacts you have in the circle of professionals you come in contact with. Much like with angel investors, VC’s are going to want a share of the equity in your company. They will want a say in the daily operations, and/or the big decisions facing your company. VC’s usually retain the right to replace management teams, dictate strategy, and drive performance. Their money is on the line and your business succeeding is usually the only way they will get it back.

Some tips on dealing with Venture Capitalist:

• You need to prove to them your company is the next big thing, or able to capture a decent size share of a large market (think billion dollar market plus)
• Show them you and your team have the knowledge, skills, ability, and experience necessary to grow your business…quickly!
• Play to how and why your company is better than the competition
• Show them your bottom…line that is. Your business needs to show it can make money, capture the market share, and grow.
• Have an exit strategy. VC’s want to see your company bought for a huge profit, or an equally lucrative IPO within 5 years or so of giving you the cash.

When dealing with angel investors and venture capitalist be sure to:

• Have a well developed business plan
• Be prepared to sell yourself, your business, and your plan. You will make or break whether or not you get funding.
• Prepare and executive summary along with the business plan that you can give them. Two pages is plenty and it should include:
  • Your mission
  • Your vision
  • A clearly defined outlook for your business
  • Explanation of products/services
  • Identify who your competitors are, how you will compete, and why you are better
  • Financial projections – short term, and long term
  • Future capital expectations and needs.

So there you have it. Regardless of what stage your small business is at, there is somebody out there looking to give you money. Hopefully this article shows that there are programs and resources to help you grow your small business. Through small business loans, tapping your friends and family for financial resources, leveraging your small business network and seeking angel investor and venture capitalist, you should be able to find someone to provide the much needed capital to help your business succeed. If you need any additional information, or a little more help in finding the money you need please email us, we’d be happy to help!

What other tips or suggestions do you have on obtaining financing for your business?