How to find private investors for your small business? Each small business needs some form of funding to get them started and keep them going. The best way to do this is to get funding through private investors. The reason is that with a private investor there are benefits that would not be available when you go with bit investors.
The question that haunts many of the small businesses just starting up is whether it is very difficult to get in with good private investors? That is a hard one though because there are many factors that would weight out the difficulty.
Where to look to find a private investor for your small business?
The first thing that factors into this is where you look to find the right private investor. This is because there may be private investors who are going to be able to meet your company needs, however they may be very far away.
There are a couple different types of private investors that you can look into for funding.
Asking family and friends to fund your business is one option. This option usually has a greater amount of leniency. Though, keep in mind that if your business ends up having financial difficulties, it is not a good idea to take out bankruptcy on family and friends.
There are also Angel Investors. These are private investors that invest their own private capital in order to help get small businesses up and running. You can visit this link to find a list of several of these types of investors. http://www.gobignetwork.com/ The Angel investors will usually invest up to $500,000. If your business requires larger funding amounts than this, you may have to look a little harder.
You can also go through venture capitalists. They tend to invest from $500,000 to a few millions of dollars. This does require that you have better credit, a great business plan and be willing to comply to much of the structure those private investors are wanting to offer. There are also several other factors that will come into the process like interest rates, terms and conditions, and much more.
There are likely to be more restrictions, higher interest rates etc from these types of investors, however it is a great way to start a small business.
What to expect when you are trying to find a private investor?
Finding the perfect private investor is not as easy as picking up your yellow pages and making a couple phone calls. There is a good deal of time that can become part of the process to finding the best private investors. It can take several months to find the right private investor. This is when your business is ready to be funded. If there are credit issues, unprepared documentation etc, it will take longer.
Make sure to analyze the business plan you are going to be trying to get investing for. Having all of your ducks in a row will make it easier to obtain private investors help. This would mean a firm business plan, good financial statements, and marketing plans. This way you will be able to offer proof of what you are asking for investing for.
This is some basic know how of how to find private investors for your small business. The main thing is to give you plenty of time to get the best deal possible.
Writing a Good Business Plan
Angel Financing – Getting the money quicker
Who are angels and what are their motivations
How to Raise Finance