The success of businesses depends on availability of finances. While a lot of people raise capital, a lot of entrepreneurs are looking for project financing from third parties. A lot of financiers are available to provide support but you do not pick money from every lender or financier that comes your way. How do you determine what to take and what to drop?
The terms of repayment will tell you whether the monies are worth taking. You might get the money you need but at very punitive conditions. By the time you are repaying, the business should have been stable or started to break even. Since the business environment is impossible to predict, you can opt for flexible terms.
How much are you being charged as fees and interests? Financiers will always demand interests and charge fees for money lent out. The rate of interest and fees charged should be lenient to avoid draining your capital or profits. You can repay a loan at terms that cripple your operations. Look at offers made by different companies or investors and settle for the most reasonable.
How easy and comfortable is it to access the finances? This relates to your qualification as a business or entrepreneur. You should have met the requirements for accessing the funds. Further, safeguard your copyright, business structure and stake even as you get finances. You should get the money comfortably and operate without terms that disadvantage you.
Is the financier offering more support beyond the money? This is a bait that many seed investors will use. They connect you to potential clients and distribution channels. This means that you are reaping more from the relationship than just money. However, take care not to cede ownership or future opportunities because of such an arrangement.
The reputation of your brand must never be affected by working with a particular investor or financier. Some organizations and individuals have the money to invest but their reputation would mean that you miss out on particular markets. It pays to wait for your reputation to grow other than ride on a brand or personality that will cost you more in the long term.
The financier must never force you to change your mission. Such a move would mean that you are implementing his or her idea instead of what you set out to work on. You will get into trouble for working on a project whose mandate has been changed. It will never get you to where you wanted to go.
What if it does not work? Contingency measures should be put in place. Have an option to negotiate repayment or even cede shareholding in order to get more finances. Such options will safe guard personal property and your integrity. It is your insurance that in case things do not work out, you will escape unhurt.
The process of looking for finances must be guided and anchored on your mission. The aims of the project must be realized regardless of the source of money. Engage a partner who is honest and allows you to work on your idea. You will be confident of the support provided whenever you are running your operations.
The terms of repayment will tell you whether the monies are worth taking. You might get the money you need but at very punitive conditions. By the time you are repaying, the business should have been stable or started to break even. Since the business environment is impossible to predict, you can opt for flexible terms.
How much are you being charged as fees and interests? Financiers will always demand interests and charge fees for money lent out. The rate of interest and fees charged should be lenient to avoid draining your capital or profits. You can repay a loan at terms that cripple your operations. Look at offers made by different companies or investors and settle for the most reasonable.
How easy and comfortable is it to access the finances? This relates to your qualification as a business or entrepreneur. You should have met the requirements for accessing the funds. Further, safeguard your copyright, business structure and stake even as you get finances. You should get the money comfortably and operate without terms that disadvantage you.
Is the financier offering more support beyond the money? This is a bait that many seed investors will use. They connect you to potential clients and distribution channels. This means that you are reaping more from the relationship than just money. However, take care not to cede ownership or future opportunities because of such an arrangement.
The reputation of your brand must never be affected by working with a particular investor or financier. Some organizations and individuals have the money to invest but their reputation would mean that you miss out on particular markets. It pays to wait for your reputation to grow other than ride on a brand or personality that will cost you more in the long term.
The financier must never force you to change your mission. Such a move would mean that you are implementing his or her idea instead of what you set out to work on. You will get into trouble for working on a project whose mandate has been changed. It will never get you to where you wanted to go.
What if it does not work? Contingency measures should be put in place. Have an option to negotiate repayment or even cede shareholding in order to get more finances. Such options will safe guard personal property and your integrity. It is your insurance that in case things do not work out, you will escape unhurt.
The process of looking for finances must be guided and anchored on your mission. The aims of the project must be realized regardless of the source of money. Engage a partner who is honest and allows you to work on your idea. You will be confident of the support provided whenever you are running your operations.
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