Raising Capital For Your Business In 2013
Times are very hard now, the days where credit was easily available for businesses have since been replaced by bank managers being resigned to the fact that there is simply not enough money to go around.
On the other hand funds are extremely crucial for businesses as growth from revenue is extremely hard to cement even for established businesses. To grow businesses need to invest so it is not only start-up companies who search for funds. For businesses this really has been a sticking point especially since the financial crisis has engulfed our lives.
Other than banks the other route to take is that of asking your friends and families. They are the ones closest to you and if any it is they who should be able to back you when you are aiming for success. The problem with this method is having friends or family members who actually have some spare cash available for you to risk into a business which may or may not work.
So relying on family members may not be fruitful for everyone. The truth of the matter is that not only do family members need to have the required cash available to lend for abut they also need to be business minded themselves. People who are happy to risk in businesses are often people with a business mind set, people who are lured by the prospect of greater returns all with an element of risk. Now each individual is different so having business minded people around in the vicinity as acquaintances is in most cases unlikely.
A notion which has risen over the last few years has been the emergence of a trend called peer to peer lending, or in much simpler terms crowd funding. Peer to peer lending has been gathering serious momentum over the last few months, which is seen by many as a replacement of the conventional route of banks being the ones to reach out to for funds.
Now there are numerous crowd funding websites which cater for businesses to highlight their proposition at very little cost where potential investors can then invest in businesses which they deem to be acceptable. The crowd funding websites act as introducers and create a valuable platform for businesses to showcase their value. The lenders are not business angels or venture capitalist companies but rather people with a more limited amount of money who are looking for either good returns on their investment or are out to promote businesses which have a cause to them.
The way these websites actually work is by having businesses listed and the proposition that is on offer. The businesses then have to list the amount that they are looking to raise and a brief introduction to their business and what it is they are looking to achieve. Prospective investors then look into the opportunities and make a decision on what they perceive to be a good proposition. So the pitch that is made online needs to be as in detail and alluring as possible. It needs to be descriptive but written in a stylish text manner which will ensure that it stands out from the competition of other businesses listed on the website.
This year there is a strong possibility that crowd funding becomes wider and wider. It has been suggested that to reach a wider audience that the websites are to become multilingual as we enter 2013. Websites such as KickStarter have already highlighted that they intend to use a language translator to convert the pitches into foreign languages as they target markets abroad for potential lenders. This has to be taken into account when writing the pitches so ensure that local nuances are avoided.