How to Raise Capital to Grow Your Business
Whether you are just starting out as an entrepreneur or you are the president of an existing mid-sized company, you have one common need, which is capital. As an entrepreneur or an existing mid-sized company, it may seem a daunting task to obtain funding. If you consider your situation and choose the right method, it does not have to be difficult to obtain additional or initial investment capital. Venture capital, angel investors, Reg A+ and equity crowdfunding are all good resources to obtain capital.
Venture capital is a great source of funding for startup companies that have proven their model, with the potential for growth. Venture capitalists seek stocks or shares of a company in exchange for a financial investment. Venture capitalists look for younger companies on the fringes of a breakthrough in technology or concept. When you choose to utilize venture capital to grow your business, be prepared to have your books open and your activities scrutinized. Venture capitalists often have significant involvement in the operation and growth of your company due to the nature of their monetary contributions. They have a stake in your business and want your business to succeed because your company is their investment. Venture capitalists usually enter into long-term investment situations. Additional consideration should be given to the fact that venture capitalists typically require a higher rate of return on investment.
Angel investors are related slightly to venture capitalists in that they generally look for successful companies with great potential and have significant amounts of money to invest. However, the angel investor is different from the venture capitalist in that the angel investor is often willing to invest in entrepreneurs starting a new business. Angel investors are generally people who have been successful themselves in business and want to help young entrepreneurs. Sometimes angel investors are friends or associates with a strong desire to help their associate succeed. Angel investors often give their time freely to assist with the business and generally accept losses without repercussions. The angel investor is typically interested in the entrepreneur’s cause or business idea and, thus, has a personal interest in the success of the business.
Crowdfunding is a fast-rising method for growing capital to start a new business. Social media has delivered the perfect vehicle to set up an account and ask people for money for your startup business. Crowdfunding is a good method for entrepreneurs with new startups. Crowdfunding has also become a good source for mid-sized companies looking to grow their businesses. There are many crowdfunding sites available ranging from Kickstarter and Go Fund Me for lower monetary contributions, to Equity CrowdFunding in the range of $100k to $3 million, on platforms such as CrowdFunder, Equity Net, and CircleUp. Crowdfunding requires a great pitch for your business and complete transparency. Be prepared to answer countless questions and undergo rigorous scrutiny as to why your company should receive this type of funding from investors.
Regulation A+, also known as “Title 4” allows main street investors worldwide to invest up to $50 mill per year in mid-stage companies and low risk mature startups, either as easily promoted equity offerings or as a Simple IPO(TM) in which a company can become publicly traded at low cost and with a simple low-cost reporting requirement.
A new type of capital raising method for startups based on digital blockchain technology. ICO means Initial Coin Offering. It’s a process where a company creates and sells its own specialized Tokens (generally) in exchange for payment in Bitcoin, Ethereum and other digital currencies (also called cryptocurrencies), with the purpose of raising capital to build a startup business. As a result, the company collects capital to fund the product development and marketing of their business, and the investors receive new specialized Tokens. These Tokens are developed with specialized functions built in, that enable innovative new blockchain based capabilities.
Manhattan Street Capital provides a compliant way to conduct ICOs in the US.
Rod Turner is the founder and CEO of Manhattan Street Capital, the #1 Growth Capital marketplace for mature startups and capital using Regulation A+. Turner has played a key role in building successful companies including Symantec/Norton (SYMC), Ashton Tate, MicroPort, Knowledge Adventure and more. He is an experienced investor who has built a Venture Capital business (Irvine Ventures) and has made angel and mezzanine investments in companies such as Bloom, Amyris (AMRS), Ask Jeeves and eASIC.mid sized companies to raise
Manhattan Street Capital, 5694 Mission Center Rd, Suite 602-468, San Diego, CA 92108.