fast money guide

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Fast Money Guid

79To Finance Your BusinessYour Banker Didnt TellYou About

Ways

Presented by


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Fast Money Guide: 79 Fast Cash Strategies for Your Business Page 2

For Help Call 800-508-1729 | www.NCHINC.com

LEGAL DISCLAIMER:

NEVADA CORPORATE HEADQUARTERS, INC. IS NOT A LAW FIRM. WE ARE NOT ENGAGED

IN RENDERING LEGAL ADVICE AND CANNOT MAKE RECOMMENDATIONS REGARDING

INDIVIDUAL CIRCUMSTANCES. THE INFORMATION IN THIS PUBLICATION IS NOT TO BE

CONSTRUED AS LEGAL ADVICE IN ANY WAY. IF LEGAL ADVICE IS REQUIRED, CONSULT

A QUALIFIED ATTORNEY. THE LAWYER REFERRAL & INFORMATION SERVICE OF THE

STATE BAR OF NEVADA IS AVAILABLE FROM 9:00 AM TO 4:00 PM, MONDAY THROUGH

FRIDAY AT 1-800-789-5747.

THE INFORMATION IN THIS PUBLICATION IS BELIEVED TO BE RELIABLE AT THE TIMEIT WAS WRITTEN, BUT IT CANNOT BE GUARANTEED INSOFAR AS IT IS APPLIED TO ANY

PARTICULAR INDIVIDUAL OR SITUATION. THE PUBLISHER HAS NO WAY OF KNOWING

THE SPECIFIC NEEDS OF THE READER. THIS PUBLICATION IS COPYRIGHTED BY

NEVADA CORPORATE HEADQUARTERS, INC. AND MAY NOT BE REPRODUCED

WITHOUT EXPRESSED PERMISSION.

Nevada Corporate Headquarters, Inc.

101 Convention Center Drive, Suite 700Las Vegas, NV 89109

800-398-1077

www.nchinc.com

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved.


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Page 3Fast Money Guide: 79 Fast Cash Strategies for Your Business

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Introduction

Here it isour little-known fast money strategies to nance your business.

There are 79 ways to gain the money you need to grow your business all presented here in one

document. There is plenty of tips and how tos on a wide range of money sources some may befamiliar to you while others are creative street-savvy methods few know about.

One strategy may be all you need or a combination of strategies will help you nance your business.

Read over the 79 strategies and take notes as you do. Check off the strategies that you can use to get the

money your business needs.

For your convenience weve included a checklist of the strategies you can print out as you read the

e-book check off the strategies you want to pursue. Then when you nish youll have a game plan ready

to execute.

If you have questions feel free to contact us. We have complete advisory programs to help you establishbusiness credit and obtain the capital you need.

With our Business Credit Accelerator II Program, a Certied Business Credit Advisor will be assigned toyou and your business to help build an A-1 business credit prole. Our Business Credit Advisors havebackground in a multitude of substantive areas and are uniquely suited to advise you on business creditdevelopment and capital structure.

Thank you for your interest in Nevada Corporate Headquarters, Inc.. We hope you nd this handy guidebenecial to your business growth.

Cort W. Christie is the Entrepreneurs EntrepreneurSince 1992 NCH has helped over 30,000 businesses get their start.

Contact Information:

Phone 775-329-7721, Fax 775-329-0852

E-Mail: [email protected]

59 Damonte Ranch Parkway, #B262, Reno, NV 89521

Nevada Corporate Headquarters

101 Convention Center Drive, Ste. 700

Las Vegas, NV 89109


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For Help Call 800-508-1729 |www.NCHINC.com

Fast Money Guide: 79 Fast Cash Strategies for Your Business

TABLE OF CONTENTS

1. Accounts-ReceivAble FinAncing ..................................................................................................a 6

2. AdvAnced sAles........................................................................................................................................a 7

3. AccRedited investoRs.........................................................................................................................a 9

4. Angel investoRs ................................................................................................................................... a 10

5. Asset-bAsed FinAncing....................................................................................................................... a 116. bAnk line oF cRedit............................................................................................................................a 12

7. bAnk loAn ................................................................................................................................................. a 13

8. buy An existing business FRom cAsh Flow..............................................................................a 14

9. bRokeRAge FiRm loAns And lines oF cRedit..........................................................................a 15

10. business development commission ..........................................................................................a 16

11. business incubAtoRs........................................................................................................................... a 17

12. business plAn wRiting contests ................................................................................................. a 18

13. cAR title loAns ..................................................................................................................................... a 19

14. competitoRs ...........................................................................................................................................a 20

15. coRpoRAte tAke-oveR - RAiding the FRAnchisee................................................................ a 21

16. cRedit cARds: business ......................................................................................................................a 2217. cRedit cARds: peRsonAl ....................................................................................................................a 23

18. cRAigslist.oRg ........................................................................................................................................a 24

19. diRect public oFFeRing....................................................................................................................a 25

20. economic oppoRtunity Zone gRAnts.......................................................................................a 27

21. FAith-bAsed initiAtive gRAnts......................................................................................................a 28

22. FedeRAl goveRnment gRAnts.......................................................................................................a 29

23. FRiends And FAmily..............................................................................................................................a 30

24. FoReign investment..........................................................................................................................a 31

25. FRAnchise youR business .................................................................................................................a 32

26. gARAge sAle..............................................................................................................................................a 34

27. home equity line oF cRedit..........................................................................................................a 35

28. hARd money lendeRs.........................................................................................................................a 36

29. instAllment loAn compAnies: quick cAsh..........................................................................a 38

30. investment bAnkeRs ..........................................................................................................................a 39

31. investment clubs................................................................................................................................ a 41

32. initiAl public oFFeRing....................................................................................................................a 42

33. inventoRy FActoRing ........................................................................................................................a 44

34. inheRitAnces..........................................................................................................................................a 45

35. institutionAl investoRs.................................................................................................................a 46

36. lotteRy tickets....................................................................................................................................a 47

37. leAsing equipment .............................................................................................................................a 48

38. letteRs oF cRedit................................................................................................................................a 49

39. license Rights to youR pRoduct oR seRvice........................................................................a 50

40. liFe insuRAnce boRRowing............................................................................................................. a 51
http://www.nchinc.com/http://www.nchinc.com/


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TABLE OF CONTENTS (continued)

41. mAnuFActuReR FinAncing ...............................................................................................................a 52

42. meRchAnt Account FinAncing.....................................................................................................a 53

43. newspApeR Ad..........................................................................................................................................a 54

44. otheR peoples money - opm ......................................................................................................a 55

45. pRoduct AdvAnces by supplieRs ...................................................................................................a 56

46. pRivAte debt ...........................................................................................................................................a 57

47. pRivAte plAcement..............................................................................................................................a 58

48. pRivAte gRAnt pRogRAms ..................................................................................................................a 59

49. pRivAte equity Fund...........................................................................................................................a 60

50. peRsonAl sAvings.................................................................................................................................. a 61

51. pRivAte pARties ......................................................................................................................................a 62

52. pAyRoll AdvAnce compAnies...........................................................................................................a 64

53. puRchAse oRdeR FActoRing ............................................................................................................a 65

54. ReveRse meRgeRs ..................................................................................................................................a 66

55. home ReFinAncing ..............................................................................................................................a 68

56. RelAted businesses.............................................................................................................................a 6957. peRsonAl RetiRement plAn: loAns.............................................................................................a 70

58. peRsonAl RetiRement plAn: cAsh ............................................................................................... a 71

59. RetiRement plAn Funding-opm ...................................................................................................a 72

60. RetiRement plAn business FinAncing-peRsonAl................................................................a 73

61. RoyAlty AdvAnces ................................................................................................................................a 74

62. RoyAlty FinAncing ..............................................................................................................................a 75

63. sbA micRoloAns 7(m) pRogRAm ........................................................................................................a 77

64. sbA lowdoc...............................................................................................................................................a 78

65. sbA expRess loAn ...................................................................................................................................a 79

66. sbA expoRt woRking cApitAl loAns (ewcl).............................................................................. a 81

67. sbA 7(A) loAn .............................................................................................................................................a 8368. sbA 504 loAns.............................................................................................................................................a 85

69. sbA sbics: smAll business investment compAnies ............................................................a 87

70. selling collectAbles........................................................................................................................a 89

71. silent pARtneRs ....................................................................................................................................a 90

72. second Job................................................................................................................................................ a 91

73. selling oR licensing pAtent Rights.........................................................................................a 92

74. selling business Assets ....................................................................................................................a 94

75. selling peRsonAl Assets ..................................................................................................................a 95

76. stAte goveRnment gRAnts .............................................................................................................a 96

77.tAx RetuRn ReFunds...........................................................................................................................a 97

78.tRAde cRedit ..........................................................................................................................................a 98

79.ventuRe cApitAl ...................................................................................................................................a 99


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1. Accounts-Receivable Financing

Accounts-receivable nancing is also known as invoice or accounts-receivable factoring. It is apopular form of raising capital for an existing business. Factoring is most suited for a business thathas a large volume of receivables. It works through a specialist factoring company that advances the

value of a percentage of the receivables to your business, less a fee, and may assume the responsibilityfor collecting the factored funds. Who assumes the risk for non-payment depends on whether the

agreement is for Non-Recourse Factoring (the factoring company assumes the risk) or Recourse

Factoring (you assume the risk), which is most common. Factored receivables usually realize between50% and 90% of value depending on the likelihood of collection identied by the factoring company.

What rates the factoring company will charge you depend on several risk factors: the credit worthiness of your customers the value of the typical invoice

the volume you pass to them for factoring

the average time to collect on receivables

In general, lower risk and higher volume for the factoring company lead to more favorable rates.

When to consider this option: If you have a small, start-up, or fast-growing business that needs money to build inventory, create an

infrastructure, maintain growth, pay creditors on favorable terms, etc., but cant get it from traditional

lenders due to a lack of business and credit history. If your company has limited credit history but your customers have solid credit.

If you want to offer your customers 30-day payment terms but need cash for your business more quickly. If your company is a service, manufacturing or wholesale business. Other options may work better for

retail businesses or those with complex products/services.

What is involved: Before you begin the process, make sure your accounts receivable is not pledged as collateral to any other

lender, as is typically true with bank loans. Check your states Uniform Commercial Code (UCC) registryfor any public documents that reect this type of commitment.

Next, the factoring rm will want to review a comprehensive list of nancial documents in order toprovide you with a quote for their services. These include your companys most recent:

Prot and Loss Statement Balance Sheet

Accounts Receivable Aging Report Accounts Payable Aging Report

You will need to sign a contract with the factoring company, which will outline terms such as the lengthof the agreement, the advance rates, fees, and other terms, and pay a fee to cover background checks,

legal searches and contract development. Once the contract is in place, you will need to forward your invoices and proof of delivery of products/

services in order to receive payment.

Starting Point: www.acteon.com; www.jdnancial.com; www.inzap.com
http://www.nchinc.com/http://www.facteon.com/http://www.jdfinancial.com/http://www.inzap.com/http://www.inzap.com/http://www.jdfinancial.com/http://www.facteon.com/http://www.nchinc.com/


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2. Advanced Sales

Advanced sales can be achieved in a number of ways and can help fund a new business, whetherthe money is used to build inventory or to help pay for ofce and stafng needs.

Litigation

Many professional service providers, from graphic designers to attorneys, offer services on a retainer

basis. Certain clients may be more than willing to pay your fees in advance to ensure your services willbe available to them as needed. Retainers are most often paid on a monthly or quarterly basis but mayalso be collected as a lump sum covering a certain time period or an extended project. While a retainerensures your availability, it is not typically tied to a projects success. Some retainers are set up to covera certain number of hours a month, while others are set up to cover certain tasks/activities without

tracking hours. Whatever route you choose to take with your clients, you will want to make sure to

always have a contract in place that spells out the specics of the arrangement.

Potential benets:Working on a retainer basis with at least some clients ensures you have a certain amount of

guaranteed income on which to base plans for your business. When you work only on a per-

project or per-case basis, your income can uctuate signicantly. When it rains, it pours, but you

never know when a drought will arise.

You have a chance to establish a long-term relationship and generate word-of-mouth referrals

which typically carry much more weight than any paid advertising.

Your clients benet from your guaranteed availability and generally a better rate in exchange for

prepayment.

Potential risks:

Clients may be less willing to commit to an ongoing expense in tough economic times. They

may prefer to deal on a xed-fee-per-project basis. You can still, however, negotiate for progress

billings which will allow you to collect fees during the project instead of having to wait for

payment in full upon completion.

You need to ensure your retainer fees are reasonable with respect to other options in the market

or you may nd yourself at a competitive disadvantage.

You run the risk of underestimating the time and expenses involved. Be sure to set your rates so

you can cover all your costs, including your wages.

You must make sure you have the time available once you have deposited (and/or spent) theretainer.

If your agreement is not specic enough about what is covered by the retainer and what

additional fees apply for services beyond those covered by the agreement, you could end up with

a disgruntled client who expected more than you bargained for. The devil is in the details (or the

lack thereof)!


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Selling Products

If you are selling a product, you can ask for deposits when an order is placed or even charge up-front

for the product while committing to deliver at a future date. For example, Web site sales are often

authorized and captured at the time of purchase although the product may be shipped at a later date.

Potential risks:

Pay attention to your merchant agreement to ensure there are not limitations to when you can

charge your customer. There may be clauses that indicate a charge cannot be processed until the

product is delivered.

Having deposited revenues from advanced sales, you must be able to provide the product or

service or you could be faced with a lawsuit.

A NCHINC.com Success Story

Ll Ls Vegs business reeived ln in he mun f $3,000,000.00. this ln ws used yff nexising mrgge, uy meirs usiness nd u 300 in heir e fr exenses fr he new usiness.the new ymen is nly $2,000.00 mre hn he ld ymen nd hey were le inrese heir ne shflw y $18,000 er mnh.


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3. Accredited Investors

The Securities Act of 1933 requires any business that offers or sells its securities to register the securities

with the Securities and Exchange Commission (SEC) or nd an exemption from the registration

requirement. One such exemption allows a business to sell company stock to a type of investor called

an accredited investor, a term used for nancially sophisticated investors who dont need the samelevel of protection as the less experienced investors the SEC seeks to safeguard.

Also known as qualied purchasers, accredited investors are dened by the SEC as:

Individuals with a personal net worth of more than $1,000,000 individually or jointly with their

spouse.

Individuals with an income that exceeds $200,000 (or $300,000 jointly with their spouse) in each

of the two most recent years, with a reasonable expectation of the same in the current year.

A bank, insurance company, registered or small business investment company, trust, charitable

organization, corporation or partnership with assets of more than $5 million.

What to keep in mind:

The total offering price must be less than $5 million in any 12-month period.

You cannot advertise or publicly solicit for investors.

You do not have to provide any nancial documentation.

All transactions must adhere to the antifraud provisions of the securities laws.

You must let investors know the securities are for investment only and cannot be resold for at

least a year unless the transaction is registered.

What accredited investors look for:

A unique technology, process, or program in an industry on which the investor is focused,

combined with a clearly dened intellectual property or product innovation at least in the

prototype stage.

Signicant barriers to competition that create a marketplace advantage for your company.

Realistic expectations of signicant short-term and long-term growth, with a detailed strategy

for its achievement.

A three to seven year exit strategy.

Thorough plans, records and documentation to allow for a proper due diligence process.

A management team that:

Is competent, ethical, success-driven, and nancially invested, with a proven track record.

Is willing to persevere and is capable of moving the business through the early-stages of

growth.

Has the potential to continually increase the companys value by achieving early and

ongoing milestones.


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4. Angel Investors

Angel investors are high net-worth individuals who invest in emerging companies. They can be hardto nd and attract, but can be a great source for business capital, as well as guidance. They are typicallyaccomplished business leaders or professionals who enjoy investing in start-up ventures of interest to

them. Angel investors are nancially sophisticated so it is important to be well prepared before youopen a dialogue with them.

What angel investors look for:A business plan that indicates clear potential for prot and growth.A business that aligns with their own interests, experience and/or expertise where they can add

value.An opportunity they believe in, can personally commit to, and want to invest their personal time

with.A detailed plan for providing them a reasonable return on their money (for example, selling the

company or taking it public) in a set timeframe (generally ve to seven years, a bit longer thanmany other types of investors).

A management/ownership team they feel comfortable with both personally and in terms of thebackground, experience and track record they bring to the venture.

Benets of angel investors:They may be willing to invest in businesses that banks consider too risky or that dont offer

enough potential prot for venture capitalists.They may be willing to invest smaller amounts of money than venture capitalists or other

nancing resources.They are a good source for guidance and advice, often acting in a hands-on advisory or

consulting role, especially during start-up.

They can help with networking to connect you with potential business partners, as well asadditional and future nancing resources.They can assist in the professional development of your organization by helping you build your

executive team and choose advisory board members.

Potential drawbacks:You will need to give up some equity in your company to receive funding.You must be willing to answer to your investor since angel investors generally take a more active

role than other funding sources.

Finding Angel Investors

You can start your search by asking your colleagues, accountant, lawyer, friends and family if they haveany referrals. Many communities today have angel investing groups or clubs that meet regularly tocollectively examine opportunities presented by budding entrepreneurs. You can nd these networksby contacting your local Chamber of Commerce or looking in the telephone book. To broaden yourhorizons, try searching the Web using Google, Yahoo or any other search engine.

Starting Point: www.investorscircle.net; www.tribeoangels.com
http://www.nchinc.com/http://www.investorscircle.net/http://www.tribeofangels.com/http://www.tribeofangels.com/http://www.investorscircle.net/http://www.nchinc.com/


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5. Asset-Based Financing

Asset-Based Financing (ABF) is becoming more widely available to smaller companies. It used to be

reserved for major business ventures but as nancing companies have perfected their practices, they

have expanded into the small business market. One popular form of ABF is invoice nancing, where a

nancing company advances funds based on existing orders ensuring that borrowing is limited to fundsthat are in the pipeline. Lenders will advance up to 95% of an invoiced value. This can be an efcient

way for a business to raise fast money.

Asset-based nancial institutions offer resourceful business funding approaches to companies that dont

qualify for conventional loans from banks and lines of credit because of their startup condition, rapid

growth, or nancial ratios which dont measure up to a banks requirements. These alternatives usually

consist of asset-based loans, accounts receivable nancing, and factoring.

Things to Keep in Mind:

Qualifying assets consist of: real property, A/R, equipment, nished inventory, and so forth. Some

nancial loans depend on a certain asset, although some function like a credit line collateralized

throughout a mix of assets.

Asset-based nancing is frequently employed just in the short-term, to give much-needed working

capital throughout a start-up or transition stage until a business has enough credit history or a

sufciently strong enough balance sheet to become bankable.

It provides a quantity of recovery time plus an economic working atmosphere where the business can

display how it could perform with a long-term bank loan in place. This enables a business to show it

can be deserving of long-term funding.

Things to be Aware of:

The business still is the owner of its assets; however they may be easily seized if repayment isnt made to

the lending company giving the credit. It is crucial to make loan repayments on time.

Starting Point: www.discountcapital.com(CRAP SITE); www.capitalassociates.com;

www.creativeundingservice.com

Another NCHINC.com Success Story

Business Expanding Equipment Lease: one f ur liens reenly ined lese fr $5,500 in FinessEquimen whih hs llwed him exnd his trining usiness.
http://www.discountcapital.com/http://www.capitalassociates.com/http://www.creativefundingservice.com/http://www.creativefundingservice.com/http://www.capitalassociates.com/http://www.discountcapital.com/


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6. Bank Line of Credit

A line of credit involves the bank setting aside designated funds for a business to draw against asneeds dictate, similar to the credit limit on a credit card. As funds are used, the credit line is reduced.Conversely, when payments are made, the line is replenished. They require a personal guarantee and

involve an annual fee to cover administrative costs.

Why to Consider this Option: Ideal for covering purchases that are too small for a traditional loan but too large for a credit

card, either because of the cards limit or the higher interest rate being prohibitive. While linesof credit typically have a higher interest rate than conventional loans, their rates are favorablewhen compared with credit cards.

Helpful for managing seasonal, predictable, or industry-related cash ow variations and servingas an emergency fund. When an expense comes up, you can immediately access the credit line(if you have not reached your limit) instead of waiting for funding from other sources.

Ongoing access to funds. You can borrow up to your limit and, as you pay down the balance,you can again spend the amount paid off as your business needs it, without needing to be

reapproved. Interest is charged only on the amount you use (like a credit card). Unlike a conventional loan,

there is no interest charged if the funds are not used.Flexible payments. Like a credit card, you can pay the minimum, the full balance, or an amount

in between, instead of having a set monthly payment as you would with a traditional loan.

Things to Keep in Mind:Need to take care not to exceed the credit lines limit and to always pay off the balance in the

time appointed.May not be approved if your company does not have a sufcient track record or credit history.Not recommended for buying property or equipment or for handling constant cash shortages,

due to interest rate and longer repayment terms on a traditional loan.

Types of Credit Lines:

Unsecured Favored by small businesses needing help with cash-ow or unanticipated expenses during times of rising

and falling sales or growth. Does not need collateral so there is no risk of losing your home, equipment or other assets. Generally offers a signicantly lesser credit line than a secured line. On the bright side, this helps protect

you from overleveraging your company.

Have noticeably higher interest rates and penalty fees than a secured line.

Secured

Favored by large businesses with more investments, assets, and cash ow. Require collateral (e.g., operating assets, accounts receivable, or inventory) Offer access to up to ten times as much money as an unsecured line at a considerably lower interest rate. Requires a solid business credit history and a minimum of two years in business. Varies in terms of interest rates, repayment terms, and possible prepayment fees so be sure to

comparison shop.

Starting Point: www.citibank.com; www.bankoamerica.com; www.irwinunion.com
http://www.nchinc.com/http://www.citibank.com/http://www.bankofamerica.com/http://www.irwinunion.com/http://www.irwinunion.com/http://www.bankofamerica.com/http://www.citibank.com/http://www.nchinc.com/


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7. Bank Loan

This is a term loan normally over a period of one to ve years. A bank loan is typically used for major

purchases, expansion of an existing business or providing capital to start a new business. Loans can

usually be completed within one month. Banks want a robust business plan that shows your potential

to repay the debt as well as a personal guarantee and excellent credit record. When considering this typeof loan, it is advisable to approach multiple banks and let them compete for your business to make sure

you get the best possible deal.

wa a af:

1. Business name, names of principals, Social Security number for each principal and the businessaddress.

2. Purpose of the loan: exactly what the loan will be used for and why it is needed.

3. Amount needed: the exact amount you need to achieve your purpose.

4. Business description: history and nature of the business, its age, number of employees and

current business assets.

5. Ownership structure: details on your companys legal structure.

6. Management prole: a short statement on each principal in your business, including background,

education, experience, skills, and accomplishments.

mar ifra:

1. Clearly dene your companys products as well as your markets.

2. Identify your competition and explain how your business competes in the marketplace.

3. Prole your customers and explain how your business can satisfy their needs.

Faa ifra:

1. Balance sheets and income statements for the past three years. If you are starting out, provide aprojected balance sheet and income statement.

2.Personal nancial statements on yourself and other principal owners of the business.

3. Collateral that youre willing to pledge as security for the loan.


Many nancial institutions also need evidence of collateral. Collateral is necessary for all Small Business

Administration loans, however the SBA doesnt automatically decline nancing in which insufcient

collateral may be the only undesirable element.

Collateral is often company assets and personal assets outside the business. If you plan to purchaseequipment and other assets with borrowed funds, you can assume that this will be used as collateral for

the loan.

Starting Point: www.wellsargo.com; www.ibank.com; www.usbank.com
http://www.wellsfargo.com/http://www.ibank.com/http://www.usbank.com/http://www.usbank.com/http://www.ibank.com/http://www.wellsfargo.com/


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8. Buy an Existing Business from Cash Flow

This unusual strategy requires you to purchase a business from its current owners and pay for it through

the existing cash ow. Check local listings of businesses for sale to identify those that are not selling

easily. Opportunities often occur when business owners just want to retire or have health problems

that force the sale of their business. Undertake a thorough due diligence, approach the seller and makean offer to pay for the business over time; then use existing cash ow from the business to pay over a

predetermined period.

Things to Keep in Mind and Questions to Ask:

What kind of down payment do I need to have to buy the company?

Will I be required to personally guarantee any nancial loans if I get the funding to purchase the

company?

What cash ow or discretionary revenue can I expect to get from the enterprise and is it enough

to support the debt and supply me with an acceptable paycheck?

Is the companys cash ow dependable and predictable?

What is the make-up of the assets being bought? Are the assets tangible, liquid assets such as

receivables and inventory, or are the assets largely intangible things such as customer databases

and goodwill?

Can the assets be utilized as a collateral for the nancial loans used to buy the business?

Can I make part of offer contingent on the future performance of the business?

The key is to nd motivated sellers willing to accept these terms.

Potential benets:

The qualication process can be much less rigorous than traditional forms of nancing.

Youll be buying an established business with proven cash ow and avoid some of the pitfalls of

a startup business.

Youll have a track record and nancials to approach a bank for more funding for expansion or

other nancial need.

Starting Point: www.sunbeltnetwork.com; www.businessbroker.net; www.bbnbrokers.com


a reen NcHINc.m lien ws rved fr $13,900 fr nning ed.
http://www.nchinc.com/http://www.sunbeltnetwork.com/http://www.businessbroker.net/http://www.bbnbrokers.com/http://www.bbnbrokers.com/http://www.businessbroker.net/http://www.sunbeltnetwork.com/http://www.nchinc.com/


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9. Brokerage Firm Loans and Lines of Credit

Many major brokerage rms like Merrill Lynch and Morgan Stanley have special programs designed for

small businesses that allow the owners quick access to various loans and lines of credit. Many have

found it simpler to get approved through a brokerage rm than a traditional bank. This is because

brokerage rms are regulated differently.

Potential benets:

Get easy and efcient access to funds.

Take advantage of competitive interest rates.

Manage multiple loans in a single account; apply only one time.

Choose from exible repayment options.

Pledge a broad range of assets as collateral.

Easily track account activity.

Potential risks:

A decrease in the market value of your eligible securities may require you to deposit funds to

meet a collateral maintenance call.

A collateral call could disrupt your investment strategy.

Your assets may be sold to meet a collateral call; the rm can sell those assets without telling you

and you are not entitled to choose which securities in the account will be sold.

You are not entitled to an extension of time to meet a collateral call.

The bank may demand full or partial repayment at any time.

The LMA account is fully recoursed to you and you will remain responsible for any shortfalls onthe LMA account.

For xed-rate and term loans, principal payments made in advance of the due date, whether

voluntarily or involuntarily, due to demand or liquidation by the bank, may be subject to a large

breakage fee as determined by the bank.

SOURCE: Merrill Lynch Wealth Management

Starting Point: www.ml.com; www.morganstanley.com
http://www.ml.com/http://www.morganstanley.com/http://www.morganstanley.com/http://www.ml.com/


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10. Business Development Commission

Many cities and regions have Economic Development Commissions (EDC). The mission of EDCs is

to attract businesses from other parts of the country into their area and to help existing local businesses

to expand. EDCs can be a tremendous source of information on business funding and often have

special grants and programs available to help with a business idea or expansion. To nd the nearesteconomic development commission, simply consult your local Chamber of Commerce.

Key Benets Available to You:

EDCs offer free counseling to help start or expand a small business.

They offer seminars on business planning and loan packaging.

Aid in writing a strong business plan to help with nancing.

Libraries containing instructional books.

Clients can have access to the Internet and business software library.


EDCs can be a treasure trove of information for entrepreneurs. Its a great way to discover new contacts

and potential business relationships.

Through their educational programs, seminars and web resources you can gain access to

Alternative lending programs.

Create linkages between potential funders and your business.

Note that it may require relocation of your business to another state or region.

Starting Point: Google the terms economic development and business development commission + your

state, county or metropolitan area.


BUSINESS ACQUISITION Loan amount $375,000:

three rners wh hd wred s he Generl Mnger, prs Mnger nd Sles Direr were le l heir resures nd uy he usiness hey hd wred fr 5 yers. beuse f he Sba requiremen

h nly 10% dwn ws needed hey ugh he usiness fr nly $40,000 dwn ymen. $13,500 erindividul nd hey nw wn he mny nd will e le inrese heir ersnl inme nd reesme j siliy fr hem.


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11. Business Incubators

In the 1990s business incubators became a unique way for experienced business professionals to help

guide and support new business ventures. These incubators have typically been used for technology-

based companies on the West Coast. The concept provides a location from which new ventures can

build their business within a facility that houses other startup enterprises. The owners of the incubator

offer rent, support, expertise, capital and a unique creative environment that can help to launch a new

business quickly.

Potential benets:

Aid with business fundamentals.

Business networking activities.

Networking with strategic partners.

Marketing and advertising support.

Support with accounting and nancial administration.

Gain access to bank lending alternatives, loan funds and guarantee programs.

Gain access to angel investors or venture capital.

Learn presentation skills.

Links to higher education resources

Intellectual property management.

Regulatory compliance help.

Advisory boards and mentors.


One-third of business incubation programs come from the economic development sector. City

and counties also have programs available as well as colleges, universities and technical colleges.

Incubation programs accept only the best and most viable companies.

They specialize in start-up and emerging companies.

Many incubators focus on particular types of companies, such as life science, technology, food

or creative industries.

These incubators have the facilities and equipment and expertise.

You will receive one-on-one attention from business experts.

Starting Point: www.nbia.org
http://www.nbia.org/http://www.nbia.org/


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12. Business Plan Writing Contests

Business plan writing contests across the nation offer cash rewards for winning new business concepts.The contests are designed to promote entrepreneurship. Competitions are hosted by colleges anduniversities, as well as corporations, government economic development agencies and non-prot

organizations that support entrepreneurship, such as the Kauffman Foundation. While many do notcharge an entry fee, some regional contests do require a modest fee to enter. Winning writers attract

money to their business through the publicity of the event as well as the cash prize.

What Is Involved:

An initial entry (or intent to compete) of two to three concise and well-written pages thatsummarize the plan by topic (product, market, competition, nancing and operations).

A detailed business plan that clearly shows how the venture will make money and that includes

market research in the form of, for example, customer surveys or trial sales programs.

An oral presentation to the judges (often venture capitalists and other investors). A question-and-answer session with the judges (usually the most challenging part needing

signicant preparation).

Helpful Hints:

Do your homework and select the opportunities that best align with your ideas. The web site ofthe organization hosting the competition is a great place to start.

Dont procrastinate. It often takes more than a year to prepare a winning plan. Ask for advice from past judges, as well as those who have won (and lost) in the past, to nd out

what worked and what didnt before you move forward. Develop a realistic plan you can use. It can act as your road map to success in your venture, even

if you dont win the contest.

Get a move on after the contest, when your enthusiasm and momentum are at a peak and yourdata is current. If you wait too long, investors may not think you are serious.

Benets

You can gain timely insight, feedback and support from potential mentors that will help youne-tune your strategy and identify any aws in your business model.

You can get the attention of potential investors and/or partners who may be judging or guidingthe contest, while also potentially gaining access to valuable resources.

While winning the cash prize will help some with your start-up needs, you will also gaincondence in your idea and its potential.

Once you have invested the time and energy in creating a plan, you will be more committed to

following through on your idea and keeping your business on track. You can use the plan to seek investors, who want a well-honed plan before they consider an

investment opportunity.

Starting Point: www.bizplancompetitions.com
http://www.nchinc.com/http://www.bizplancompetitions.com/http://www.bizplancompetitions.com/http://www.nchinc.com/


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13. Car Title Loans

A quick injection of business funding is available with a car title loan. These loans, for up to a vehiclesmarket value, can be obtained through licensed lenders. Only available with a free and clear title, themain benet is that loans are usually approved on the day of application. This loan is very expensive

(typically a triple-digit annual interest rate is attached) and should therefore be approached with extremecaution and as a short-term measure only.

Key Facts to Keep in Mind:

To get a title loan on your vehicle, you must own the car outright, that is, have clear title to thecar. This means no outstanding loans.

Title loans are a short-term loan. Usually a few months to less than a year. As with most short-term loans your title loan will likely carry a high interest rate. (Triple digits!) With such high interest rates, it is more advisable to pay off your title loan as soon as possible

and avoid interest charges.

Most title loans are for less than $5,000--which make them easy to repay in less than a year.

The good thing with the title loans is that you are free to use your property even after placing thetitle with the lenders.

Potential Drawbacks:

If you fail to make payments on your title loan, the lender will repossess your car and sell it and

charge you for the costs that they accrue doing so. Car title loans are being used by predatory lenders to take advantage of unsuspecting consumers.

A car title loan payment is due within a month and often is for an amount that is far less thanthe value of the vehicle.

If you are in need of emergency cash, there are much smarter choices to a car title loan. Thesealternatives include small consumer loans, and cash advances on credit cards.

Starting Point: Search on Google or car title loans or payday loans.

More Success Stories at NCHINC.com

Lines of Credit for Their Businesses:

Seve hs reeived $70,000 in ne mnh lne! beween him nd his usiness rner, hey hvereeived $155,000 in l funding!

thr (y using redi rner) reeived $80,000.

Rnld hs reeived $49,000 wih mre liins fr funding sill ending.
http://www.google.com/search?as_q=car+title+loanshttp://www.google.com/search?as_q=payday+loanshttp://www.google.com/search?as_q=payday+loanshttp://www.google.com/search?as_q=car+title+loans


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14. Competitors

An interesting concept for raising money for a new business is to regard local competitors as a sourceof investment capital. Some business owners become entrenched in business models that work but arenot necessarily efcient. They would welcome an improved working model, but after years of running

the business a certain way, they nd it difcult to make the change. If they are shown an innovativenew approach, it might just get their attention. What could be better than having an investor whounderstands your business?

Begin With Competitive Research:

To gather competitive research, rst set a framework for your competitive assessment.

Start by opening a new Excel worksheet and creating the following columns

outlining your competitors:

Name (and location if relevant)

URL Elevator pitch (brief answer to the question Who is this company?)

Mission (if it exists) Products and services offered (with pricing) Strengths (What is the competitor good at?) Weaknesses (Where does the competitor fall short?) Key brand differentiators (What are the messaging, product and service offerings, etc., that set

the competitor apart from their competition?)

Next

Note their processes. (Manufacturing, marketing, distribution, JV partners, and more.) Track down the owners contact info, postal mail and email. Create a compelling and interesting proposition to present to them. Base the proposition on your new way to (), increase effective yield, reduce waste and

boost bottom line, guaranteed execution or whatever you have to offer that will increase theirbusiness prots.

Craft a letter that introduces your proposition to themmake the secret sauce (your new wayto ()) vague you dont want to give away the secret until you have a nancing arrangement.

To create urgency mention that you are making the same offer to other businesses in your areaand will make a decision based on the terms of the arrangement.

This strategy is somewhat unorthodox and counterintuitive but it can work if you do the numbers. Makeenough offers and someone may welcome your proposition it could be just what they were waiting

for.

Starting Point: Local Yellow Pages or the Chamber o Commerce usually has a compiled list o businesses byyour zip and surrounding areas.


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15. Corporate Take-over - Raiding the Franchisee

It is not uncommon for a poorly managed franchisee operation to lie about their royalties and underpaythe franchisor. In turn, the franchisor will not be averse to pointing out where these suspect franchisees

are located. Often, franchisees will have defaulted on their leases and not paid rent, forcing the landlord

to evict them. In a restaurant, all the equipment is often left behind. In these circumstances, there is anenormous opportunity for an enterprising individual to take over the entire operation.

Advantages

You will be up and running in no time. You will have a practical overview of previous success. You will prevent certain costs. Be sure to closely inspect the business agreement youre entering.

Often you will enter the present business agreement, not a brand-new one that new franchiseeswould enter. This could be associated with great advantage to you, specically fees paid to the

franchisor in the current agreement are lower than such a brand-new franchisee would have topay.

Important Tips

Discover why the leaving franchisee is leaving the company! He or she could be leavingthecompany because of bad, unstable relationships with the franchisor that could plague you aswell.

The particular purchase price for that current franchise is going to be something the leavingfranchisee decides, or something the two of you gure out collectively.

Ask for an information packet from the franchisor. Job interview owners of current businesses. Research the business with other franchises in this industry. Look for expert advice to understand the franchise agreement.

Questions To Ask

Just how long has the franchisor been in business? The number of franchised shops in the area? Where are they located?

How much is the preliminary franchise fee as well as any extra new venture expenses? Are thereany ongoing royalty payments? How much?

What management, technical, and continuing help does the franchisor provide? Exactly what regulations will the franchisor impose?

Starting Point: Search on Google or (geographical location) anchise or sale. Scan local classieds onlineand o-line. Do drive-bys where many anchises are ound look or closed sign duringoperation hours.


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16. Credit Cards: Business

Every new business owner should begin to apply for corporate credit cards as soon as he or she starts

operation. It is important to use the cards regularly to establish a credit history. Doing so will aid in

building the size of the credit line. Ask for credit limit increases every six months to build credit to a

level that can be useful for the business. It makes sense to apply for business credit cards well before

they are needed.

Credit cards will provide a great route to fast money.

You can start building your business credit even before opening your doors.

Your rst step is to set up your business as a separate organization, to separate your company

credit user prole from your personal credit user prole. This means you want your business to

be structured as a corporation.

A businesss creditworthiness is ultimately based on what are known as the four Cs of credit

- character, capacity, capital, and conditions - most of that exists explicitly or even implicitly in a

companys credit report.

Youll want to start making early purchases for the business. Make purchases through vendors

who will let you set up credit depending on your personal credit background. Report your

transactions to the credit bureaus.

Next, you want to nd out exactly what the requirements are for each lender as well as credit

bureaus. By doing such a credit assessment, you will know what standards are expected before

you begin to establish your credit prole.

Potential risks:

You have to make quick payments and make sure theyre documented at the credit bureaus.

This is costly debt with interest rates from 15% to 25%. And it is dangerous. Use with caution

and have a reasonable plan for repayment.

Its best to use for emergencies.

Starting Point: www.americanexpress.com; www.capitalone.com/smallbusiness
http://www.nchinc.com/http://www.americanexpress.com/http://www.capitalone.com/smallbusinesshttp://www.capitalone.com/smallbusinesshttp://www.americanexpress.com/http://www.nchinc.com/


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17. Credit Cards: Personal

Many entrepreneurs use their personal credit cards to nance their business at rst. Credit cards can be

a great source of funding to start a new business or to help buy the necessary supplies and equipment

needed to get started. However, keep in mind that credit card interest rates can be expensive if not

repaid quickly. Many credit cards offer special promotional rates on cash advances to encourage use, but

to take full advantage you need to negotiate a reasonable interest rate. Call the credit card company to

see what they can offer and always shop around for zero interest periods on transferred balances.

What is involved:

When you apply for credit cards, select a card which has many functions and afliations. (Air

miles, warranty extensions and bonus points for purchases.)

Ones with universal use and low interest are the best choice for your personal nance.

Figure out and read all the details of the agreement.

Identify and record all purchases made.

Take note of the billing time and repayment amounts.

Make reminders for yourself for repayment schedules so you dont miss a payment and steer

clear of penalties and charges.

Another way to maximize the use of your credit cards is to take note of promotions and

discounts.

When unique sales can be found, take advantage of all discounts and purchase offerings.


It is a fact that credit cards can wreck your personal nances, especially when used irresponsibly.

Irresponsible use would include impulse buys, unnecessary purchases, and hoarding.

Before you make any purchases, always check your balance so you dont go overboard.

Dont mix personal and business purchases. Use separate charge accounts for each though

this can be hard to do when youre starting a new business.

Starting Point: www.capitalone.com; www.discovercard.com; www.creditcards.com; www.cardratings.com
http://www.capitalone.com/http://www.discovercard.com/http://www.creditcards.com/http://www.cardratings.com/http://www.cardratings.com/http://www.creditcards.com/http://www.discovercard.com/http://www.capitalone.com/


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18. Craigslist.org

One innovative way of attracting investment into your business is to place an online classied

advertisement on a posting service such as Craigslist.org. An advantage of Craigslist.org is the

advertisements are free, and the site is accessed by a large and diverse audience. There are many local

online ad services that can be used when looking for investors. Make sure your advertisements are

creative and specic to your target investor type.

Helpful Hints:

Writing a Good Ad

Use some unique keyboard characters in your Title (headline).

Indent your description (body copy) and use ALL CAPS.

Use some rhyme. Use words creatively. Dont blend in - stand out.

Use urgency and scarcity to compel action.

Study other ads of similar nancing offers and copy what works.

Place your ad in the best category.

Remember, youre looking for a lead to close the deal from your Craigslist ad.


Avoid HTML. Plain text ads increase approval.

Avoid hyperlink to a website. Put the domain name as text without www. or put it into an image.

Titles must match corresponding category you are posting to.

Use anonymous email feature of Craigslist.

Dont use an external image using HTML tags. Use the Craigslist image upload function instead.

Check spelling and punctuation.

Short relevant descriptions work well.

Dont use a lot of special characters in titles.

LET THE BUYER BEWARE: Buyer beware. Always do your due diligence on a potential investor.

Starting Point: www.craigslist.org; www.backpage.com; www.ebayclassieds.com; www.useeads.com
http://www.nchinc.com/http://www.craigslist.org/http://www.backpage.com/http://www.ebayclassifieds.com/http://www.usfreeads.com/http://www.usfreeads.com/http://www.ebayclassifieds.com/http://www.backpage.com/http://www.craigslist.org/http://www.nchinc.com/


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19. Direct Public Offering

Entrepreneurs nationwide are beginning to use the Direct Public Offering (DPO) as a creative form of

nancing. This is a public stock offering but differs signicantly from the Initial Public Offering (IPO)

or venture capital nancing. DPOs are security offerings registered with state security administrators

rather than the federal SEC. They have simpler procedures and cost less than full-blown public

registrations. DPOs are often used to secure clients, employees, suppliers and distributors as another

way to market the company and to raise capital.


When a company raises funds by advertising its shares directly to its customers, workers,

suppliers, marketers and buddies in the community.

DPOs tend to be an alternative to underwritten open public offerings through securitiesbroker-dealer companies where a companys shares are sold to the brokers clients and potential

customers.

Direct open public offerings tend to be less costly than traditional underwritten offerings.

Also, they dont have the restrictions which are usually related to a bank as well as venture capital

funding.

A DPO will typically raise much less than a conventional offering.

Companies seeking a DPO must provide: A prospectus to its prospective and existing shareholders

Publicly available nancial reports

Accurate and up-to-date stock information available to the public

Audited nancial statements to be in compliance with #2

The corporation may sell securities once completing a DPO by direct methods; telemarketing or mail

outs but may also develop a brokering system to aid in the day-to-day management of such securities.

Advantages and Disadvantages:

DPOs, personal placements of stock, with other exempt offerings supply small businesses with a

quicker, less expensive way to raise venture capital.

The primary benet of DPOs over IPOs is a dramatic decrease in cost. IPO underwriters


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typically charge a commission of thirteen percent of the earnings from the sale associated with

securities, while the costs of a DPO are nearer to 3 percent.

DPOs may also be completed within a smaller time frame and without extensive disclosure of

condential information.

Finally, since the inventory sold via a DPO goes to a restricted number of investors who are apt

to have a long-term alignment, there is often less pressure on the corporations management to

deliver short-term results.

DPOs also have disadvantages:

The total amount that an organization can increase through a DPO within any 12-month time

period is limited.

The stock is usually sold at a lower price compared to what it might command through an IPO.

Stock offered through exempt offerings is not usually freely traded, so no market price is

established for the gives or for the overall company. This particular lack of a market price may

make it difcult for that company to use equity because loan security.

DPO traders are likely to need a larger share of ownership in the company to counterbalance

the lack of assets in their placement. Investors eventually may urge the company to go public

with an IPO to enable them to realize their prots.

Starting Point: www.virtualcapitalgroup.com


Dug ined $75,000 in he 1s phse - $30,000 frm 1 lender 0% fr 12 mnhs.

Jusine hs reeived $82,000 & hs ne mre liin ending.

Willim g n $80,000 il infusin fr his usiness.
http://www.nchinc.com/http://www.virtualcapitalgroup.com/http://www.virtualcapitalgroup.com/http://www.nchinc.com/


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20. Economic Opportunity Zone Grants

Economic Opportunity Zone Grants, or Federal Government Economic Zone Awards, are available toanyone starting or expanding a business in one of these designated areas of the country. Incidentally,the federal government is required to buy a certain percentage of their supplies from businesses

operating within these zones.

The framework for the Empowerment Zone Initiative is embodied in four key principles:

Strategic Vision for Change Community-based Partnerships Economic Opportunity Sustainable Community Development

What it takes to qualify:

A potential applicant must

State a clear vision and goals for the future. Explain how the vision creates economic opportunity, encourages self-sufciency, and promotes

sustainable community development. Builds on the assets and opportunities available and presents a coordinated strategy toward

solving them.

Set out performance standards for measuring progress, and a framework for evaluating andmaking future adjustments to the Strategic Plan.

An EZ designee should understand:

The existing economic base of the area including those sectors that will most likely provide jobopportunities for residents.

The credit and capital needs of business and the type of labor skills they need. The skill levels of residents and the kinds of programs that could upgrade those job skills. The barriers to employment such as child care, transportation, drug treatment, low job skills,

etc., and how those barriers may be overcome. How the changing metropolitan, regional, national and global economic conditions, including

military base closure and out-migration, affect the economic base.

How to bring jobs to the workforce and how to get people to job opportunities by improvingtransportation infrastructure.

SOURCE: www.HUD.gov
http://www.hud.gov/http://www.hud.gov/


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21. Faith-based Initiative Grants

Faith-based initiatives are designed to support local communities. Established by the federalgovernment, they have federal grants available for low-income development areas. A church writes the

grant to sponsor economic opportunities for the underserved. The church can sponsor one or multiple

businesses, business initiatives within their neighborhood and often support a parishioner in the church.


Faith based government grants are available for faith based businesses and are made to helpthese organizations along with other similar ones.

The main focus of these organizations is to work for the benets of at-risk youth, the homelessand hungry, ex-offenders, medication addicts, well-being to work families and patients of HIVand AIDS.

You will nd varieties of federal grants for individuals available for these types of organizations,there are many people suffering from one issue or another.

It depends on the need as well as purpose of the business that they make an application for thegrant.

What it takes to qualify:

When applying for the grant, the organization must keep in mind the amount they are going toreceive because this will make them see whether that grant is suitable for that need or not.

It is important to apply for the most suitable grant because fullling the need is important at anycost.

If your business is not given proper nancial aid, theyll nd themselves in the same position

they were before you apply for the grant. In reality the grants or loans are available and provide sufcient amount of cash to fulll

the requirements and prot the organization who carry out the activities and the programseffectively.

The federal government readily provides these types of organizations with funds so they willcarry on their own social service activities.

If youre connected with any of these organizations, you can apply for nancial help from the

government as the government has put aside a good amount of cash for this purpose.

Apart from government, there are other private businesses and nonprot organizations that offer funds

to this type of organization. You can make an application for as many grants as you wish. There is nolimit in applying for faith based government grants and you only have to provide the proof of yourorganization.

Starting Point: www.whitehouse.gov/government/bci/grants-catalog-index.html
http://www.nchinc.com/http://%20www.whitehouse.gov/government/fbci/grants-catalog-index.htmlhttp://%20www.whitehouse.gov/government/fbci/grants-catalog-index.htmlhttp://www.nchinc.com/


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22. Federal Government Grants

There are many different grant programs for budding entrepreneurs offered by the US government.These federal grant programs, available to both new and existing businesses, vary in many ways. Someprograms are only available to certain minorities; some are targeted toward a certain industry ortechnology (such as alternative energy) and others are focused on economically depressed areas of thecountry. This source of business funding is worthy of investigation.

Potential benets: Grants are the best possible source of nancing. Unlike contest winnings, they arent taxable and, unlike a loan, its not necessary to pay them back. Keep in mind: Grants typically dont cover your complete capital needs, and you usually have to

pony up the same amount for the project youre aiming to nance.

What it takes to qualify: Grants are not simple to come by, despite what some spam emails may say. Often, grants are made only if they benet the community. As an illustration, there may be

state or local grants for child-care centers, for several green projects or for an enterpriseguaranteeing to produce jobs in an economically distressed area.

For you to secure a grant, its essential to go through a rigorous application process and followsubmission deadlines.

To discover more about grant opportunities at the state level, check with your states economicdevelopment agencies. Also nd federal grant opportunities on the governments site.

Contact local colleges. Some colleges and universities offer nancial support to entrepreneurs throughtheir small business and entrepreneurial centers.

However, please note that grant requirements are strenuous, and theres much competition for small andhome-based business grants.

Grants by Cities And Local Organizations Grants by cities for local redevelopment projects or restoration projects are occasionally available

to qualifying businesses. These grants are for established businesses found in economically depressed areas. Tax Credits and Services - Many cities and states offer tax credits for various programs, including

training of employees and efforts to increase employment. There are also free services provided in the areas of business planning, marketing, and nancial

advice.

Consulting services are provided for these areas at substantially discounted rates as well byparticipating professionals.

Check with your local city, Chamber of Commerce and Small Business Development Center tosee whats available.

Starting Point: www.grants.gov
http://%20www.grants.gov/http://%20www.grants.gov/


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23. Friends and Family

A common source of seed capital used to get a business started is investment from family and/or

friends, although this type of investing is a mixed blessing. While it is often an easy source for smaller

amounts of investment dollars needed, because of the close bonds between family and friends, it can

also be the most challenging.

Normally unsophisticated investors, friends and family typically nance your business because they

believe in you and genuinely want to help. However, if the business fails or a loan is not repaid in time,

the nancial relationship can seriously affect your personal relationships. The authors recommendation

is to think carefully before using this source of funding.


If you have friends and family willing to help you, approach them as you would any potential

investor.

Present a professional loan request with supporting materials such as a business plan and

earnings projections, just as you would to a commercial lender.

Draft a contract that outlines the terms and conditions of the loan and the obligations of both

parties.

Dont borrow more than you are willing and able to repay over time if your business doesnt

work out.

Some family members or friends might be willing to risk their money in exchange for an equity

stake in your business.

The bottom line of this money source is, if you cant repay the loan, can you face Uncle Bill at the next

family reunion?

Starting Point: Your list o relatives, Christmas card lists and address books.


$85,500 fr pul $55,000 in ne mnh lne!! ollie g $64,000 fr his usiness exnsin.

Willim hs reeived $50,000 eween 2 lenders nd sill hs 4 ending liins!!


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24. Foreign Investment

As world trade growth shifts from one country to another, investment capital moves with it to gain

maximum return. When a certain countrys economy (e.g. China) is booming, it attracts signicant

funds from foreign investment.

Attracting foreign investment to a business will take serious research and development to create a win-

win proposition. For example, perhaps a foreign company in a similar market sector is seeking new

distribution channels to grow their business within the United States. Identify companies that will

benet from a unique alliance or business concept and approach them with your ideas.

There can be many international joint venture opportunities available on the Internet. Finding a perfect

t for your business can take time and research. But having just one that really takes off can be worth

the effort.


A true joint venture is considered to be a full alliance in which an independent entity is created,

involving two or more partners.

The concept of an entity - an organizational form having separate structure and identity from

the participating partners - is central to the joint venture concept and distinguishes it from other

types of collaborative relationship.

Make a list of what you have to offer a JV partner. Distribution, manufacturing capacity, a new

process, cost efciencies, marketing savvy, political connections, and regulatory know-how are all

good things to offer a potential partner.

Write a proposal of what you have to offer and seek.

Customize it for each potential partner.

Create a list of partners.

Send them a query letter or email.

Send your proposal if requested.

Starting Point: www.go4worldbusiness.com; www.b2binternational.com; www.internationaldirectory.biz/
http://www.internationaldirectory.biz/http://www.internationaldirectory.biz/http://www.internationaldirectory.biz/http://www.b2binternational.com/http://www.internationaldirectory.biz/http://www.internationaldirectory.biz/http://www.b2binternational.com/http://www.go4worldbusiness.com/


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25. Franchise Your Business

An enterprise with a proven, successful business model might consider franchising. This process

essentially duplicates the original business to service cities all around the country or even the world. In

a franchise operation, a prospective business owner pays a sizable fee and a percentage of gross sales

to introduce the entire business model into other markets. Experts in the eld can be hired to help

navigate through the law that regulates franchises.

What Is a Franchisable Enterprise?

What kind of company do you have now? Even if you believe franchising is for an individual,

that doesnt mean your business is franchisable.

No matter how protable your business is, it will not work as any franchise unless of course it

appears to be a great business opportunity.

What makes an appealing business?

The business should be based on a concept with pizzazz, such as a fresh kind of fast-food or a

trademarked technology for repairing vehicle nishes.

To be successful, a franchise has to capture the sight of would-be companies. Its easier to

market the franchise along with built-in appeal compared to one that appears like some ordinary

business.

Your business must create a superior service or product. Nobody wants to buy as well as run a

franchise whose achievement is based on being the lowest-cost maker.

If you produce a superior service or product, it also has to be possible for one to control the

grade of that product or service.

Much of the particular appeal of any franchise program to consumers lies in the fact, no matter

where each goes, if they patronize among that systems franchises, theyll get the exact same

quality of service and product they would get anywhere else.

Unless your product or service or program is one that lends itself to that standardization, youare going to have trouble franchising your notion.

If you have a good product, a good market as well as plenty of air, you need to search for

some safety.

Specically, you need to have a strong trademark. The best franchises, such as Train and


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ServiceMaster spent plenty of time and money creating strong trademarks that express a

consistent and appropriate message about the item and the operation.

More Things to Keep in Mind:

An excellent franchise idea has to be teachable. That means it has to end up being something

you can explain to others and that it can be easily grasped.

Your franchisable company should be systematized and its operations documented so it

can be copied by other people. In addition, it needs to be a company that can perform in a

noncentralized method.

If your business is run based on knowledge which exists only in your head and needs your

personal involvement every step of the approach, youll have problems franchising it.

Repeatability is an essential ingredient of the franchisable business. Which means your business

should be one that can be mirrored again and again in many areas by many individuals.

Incorporating all of these features into your company is going to take some time and vitality. In fact,

franchising is a different company from whatever business you are in now.

Starting Point: www.anchise.org


We susnilly imrved Rgers redi rer in less hn 60 dys nd he hs reeived $55,000

eween 3 lenders uing him l f $93,000 s fr.

Dve S. g $25,000 frm ne lender...lus sme her rvls.

Ed & Ry hd sme hllenges (nd sme urve lls) u heyve su wih i nd dne wh we ld

hem - $76,350 s fr wih mre me!

plus, $38,500 fr Russ G. (hrugh redi rner).
http://www.franchise.org/http://www.franchise.org/


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26. Garage Sale

One quick way to raise small amounts of money for a business launch is to hold a good old-fashionedgarage sale. Gather all the wonderful treasures that have been hoarded for no obvious reason. Askfamily and friends to part with their unwanted items too. It is astonishing what things people will pay

good money for, and it can be surprising how much can be raised towards funding your startup.

Key points you want to think about

First allow me to say that having a successful yard sale is HARD work! Im not planning to sugar-coat it and say that its a piece of cake.

Find out if you can nd any constraints your neighborhood or local government may have on lawnsales/ garage sales. Some areas may need permits and have a restriction on how many lawn/garagesales a person is allowed to have each year.

Advertise your yard sale on the net for free!! There are several places online who have free yard saleads.

Advertise in your local paper, especially if your geographical area doesnt get much trafc. If youare unsure of what to say inside your ad, study some other ads and copy bits and pieces from their

website. Be aware that you may nd laws about the placement of signs (like yard sale signs). Some locations

are lax in enforcement of the laws and others are usually strict. Set up advertisements on storyboards in your community (grocery stores, neighborhood center, and

so forth). Spread the news of your yard sale by word of mouth, co-workers, friends etc. It will take time to help to make good-looking, durable, legible do-it-yourself yard sale signs (then

you have to deal with the way to post them up). Check with your state government or perhaps homeowners association to see if there are limits on

backyard sale signs. Dont choose a holiday weekend (Memorial Evening, 4th of July, Labor Day) to have your sale.

Youll usually have a far better turnout if its the nonholiday weekend.

More Tips You Should Consider Expect early birds. A few sellers like them, other folks hate these. If you dont want them, consider

putting NO EARLY BIRDS in your ad. Then if people show up before your own start period justpoint out Prices before 8am tend to be doubled (or even tripled).

Know when the major companies in your area receives a commission. If you know the largestemployer in your community only will pay on the 1st of the 30 days (or whatever) then routine youryard sale for an added Saturday. Other people have explained the same regarding waiting till after themonthly Social Security checks turn out.

Months before your backyard sale, begin gathering the items you want to market. Put all the items ina box in a some what out-of-the-way spot. If you dont recover something out of the box ahead ofthe sale, its probably secure to presume you dont want it.

As you build up items for your s

fast money guide

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