Fast Money Guide

Fast Money Guide
79
Ways
To Finance Your Business Your Banker Didnt Tell You About
Presented by
Fast Money Guide: 79 Fast Cash Strategies for Your Business
Page 2
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 TIME IT 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 700 Las Vegas, NV 89109 800-398-1077 www.nchinc.com
Copyright
2012 Nevada Corporate Headquarters, Inc. All rights reserved.
For Help Call 800-508-1729 | www.NCHINC.com
Page 3
Introduction
Here it isour little-known fast money strategies to finance 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 be familiar 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 finance 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 finish 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 establish business credit and obtain the capital you need. With our Business Credit Accelerator II Program, a Certified Business Credit Advisor will be assigned to you and your business to help build an A-1 business credit profile. Our Business Credit Advisors have background in a multitude of substantive areas and are uniquely suited to advise you on business credit development and capital structure. Thank you for your interest in Nevada Corporate Headquarters, Inc.. We hope you find this handy guide beneficial to your business growth.
Cort W. Christie is the Entrepreneurs Entrepreneur

Contact Information: Phone 775-329-7721, Fax 775-329-0852 E-Mail: Cort@nchinc.com 59 Damonte Ranch Parkway, #B262, Reno, NV 89521 Nevada Corporate Headquarters 101 Convention Center Drive, Ste. 700 Las Vegas, NV 89109
Since 1992 NCH has helped over 30,000 businesses get their start.
Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved
Page 4
TABLE OF CONTENTS
1. Accounts-Receivable Financing...................................................................................................page 6 2. Advanced Sales.........................................................................................................................................page 7 3. Accredited Investors..........................................................................................................................page 9 4. Angel Investors.................................................................................................................................... page 10 5. Asset-Based Financing........................................................................................................................ page 11 6. Bank Line of Credit............................................................................................................................. page 12 7. Bank Loan.................................................................................................................................................. page 13 8. Buy an Existing Business from Cash Flow............................................................................... page 14 9. Brokerage Firm Loans and Lines of Credit........................................................................... page 15 10. Business Development Commission........................................................................................... page 16 11. Business Incubators............................................................................................................................ page 17 12. Business Plan Writing Contests.................................................................................................. page 18 13. Car Title Loans...................................................................................................................................... page 19 14. Competitors............................................................................................................................................ page 20 15. Corporate Take-over - Raiding the Franchisee................................................................. page 21 16. Credit Cards: Business.......................................................................................................................page 22 17. Credit Cards: Personal.....................................................................................................................page 23 18. Craigslist.org......................................................................................................................................... page 24 19. Direct Public Offering.....................................................................................................................page 25 20. Economic Opportunity Zone Grants........................................................................................page 27 21. Faith-based Initiative Grants.......................................................................................................page 28 22. Federal Government Grants........................................................................................................page 29 23. Friends and Family.............................................................................................................................. page 30 24. Foreign Investment........................................................................................................................... page 31 25. Franchise Your Business..................................................................................................................page 32 26. Garage Sale.............................................................................................................................................. page 34 27. Home Equity Line of Credit...........................................................................................................page 35 28. Hard Money Lenders..........................................................................................................................page 36 29. Installment Loan Companies: Quick Cash..........................................................................page 38 30. Investment Bankers...........................................................................................................................page 39 31. Investment Clubs................................................................................................................................. page 41 32. Initial Public Offering.....................................................................................................................page 42 33. Inventory Factoring.........................................................................................................................page 44 34. Inheritances........................................................................................................................................... page 45 35. Institutional Investors..................................................................................................................page 46 36. Lottery Tickets..................................................................................................................................... page 47 37. Leasing Equipment.............................................................................................................................. page 48 38. Letters of Credit................................................................................................................................. page 49 39. License Rights to Your Product or Service.........................................................................page 50 40. Life Insurance Borrowing.............................................................................................................. page 51
Page 5
TABLE OF CONTENTS (continued)

41. Manufacturer Financing................................................................................................................page 52 42. Merchant Account Financing.....................................................................................................page 53 43. Newspaper Ad........................................................................................................................................... page 54 44. Other Peoples Money - OPM.......................................................................................................page 55 45. Product Advances by Suppliers....................................................................................................page 56 46. Private Debt............................................................................................................................................ page 57 47. Private Placement............................................................................................................................... page 58 48. Private Grant Programs...................................................................................................................page 59 49. Private Equity Fund...........................................................................................................................page 60 50. Personal Savings................................................................................................................................... page 61 51. Private Parties....................................................................................................................................... page 62 52. Payroll Advance Companies............................................................................................................page 64 53. Purchase Order Factoring.............................................................................................................page 65 54. Reverse Mergers................................................................................................................................... page 66 55. Home Refinancing............................................................................................................................... page 68 56. Related Businesses..............................................................................................................................page 69 57. Personal Retirement Plan: Loans..............................................................................................page 70 58. Personal Retirement Plan: Cash................................................................................................ page 71 59. Retirement Plan Funding-OPM....................................................................................................page 72 60. Retirement Plan Business Financing-Personal.................................................................page 73 61. Royalty Advances................................................................................................................................. page 74 62. Royalty Financing............................................................................................................................... page 75 63. SBA Microloans 7(m) Program.........................................................................................................page 77 64. SBA LowDoc................................................................................................................................................ page 78 65. SBA Express Loan.................................................................................................................................... page 79 66. SBA Export Working Capital Loans (EWCL)............................................................................... page 81 67. SBA 7(a) Loan.............................................................................................................................................. page 83 68. SBA 504 Loans.............................................................................................................................................. page 85 69. SBA SBICs: Small Business Investment Companies.............................................................page 87 70. Selling Collectables.........................................................................................................................page 89 71. Silent Partners..................................................................................................................................... page 90 72. Second Job................................................................................................................................................. page 91 73. Selling or Licensing Patent Rights..........................................................................................page 92 74. Selling Business Assets.....................................................................................................................page 94 75. Selling Personal Assets...................................................................................................................page 95 76. State Government Grants..............................................................................................................page 96 77. Tax Return Refunds............................................................................................................................page 97 78. Trade Credit........................................................................................................................................... page 98 79. Venture Capital.................................................................................................................................... page 99
Page 6
1. Accounts-Receivable Financing
Accounts-receivable financing is also known as invoice or accounts-receivable factoring. It is a popular form of raising capital for an existing business. Factoring is most suited for a business that has 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 responsibility for 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 between 50% and 90% of value depending on the likelihood of collection identified 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) registry for any public documents that reflect this type of commitment. Next, the factoring firm will want to review a comprehensive list of financial documents in order to provide you with a quote for their services. These include your companys most recent: Profit 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 length of 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.facteon.com; www.jdfinancial.com; www.inzap.com
back to top
Page 7
2. Advanced Sales
Advanced sales can be achieved in a number of ways and can help fund a new business, whether the money is used to build inventory or to help pay for office and staffing 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 will be available to them as needed. Retainers are most often paid on a monthly or quarterly basis but may also be collected as a lump sum covering a certain time period or an extended project. While a retainer ensures your availability, it is not typically tied to a projects success. Some retainers are set up to cover a 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 specifics of the arrangement.
Potential benefits:
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 perproject or per-case basis, your income can fluctuate significantly. 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 benefit 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 fixed-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 find 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) the retainer. If your agreement is not specific 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)!
back to top
Page 8
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
Local Las Vegas Business received a loan in the amount of $3,000,000.00. This loan was used to payoff an existing mortgage, buy a competitors business and put 300k in their pocket for expenses for the new business. The new payment is only $2,000.00 more than the old payment and they were able to increase their net cash flow by $18,000 per month.
back to top
Page 9
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 find 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 financially sophisticated investors who dont need the same level of protection as the less experienced investors the SEC seeks to safeguard. Also known as qualified purchasers, accredited investors are defined 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 financial 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 defined intellectual property or product innovation at least in the prototype stage. Significant barriers to competition that create a marketplace advantage for your company. Realistic expectations of significant 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 financially 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.
back to top
Page 10
4. Angel Investors
Angel investors are high net-worth individuals who invest in emerging companies. They can be hard to find and attract, but can be a great source for business capital, as well as guidance. They are typically accomplished business leaders or professionals who enjoy investing in start-up ventures of interest to them. Angel investors are financially sophisticated so it is important to be well prepared before you open a dialogue with them.
What angel investors look for:
A business plan that indicates clear potential for profit 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 five to seven years, a bit longer than many other types of investors). A management/ownership team they feel comfortable with both personally and in terms of the background, experience and track record they bring to the venture. They may be willing to invest in businesses that banks consider too risky or that dont offer enough potential profit for venture capitalists. They may be willing to invest smaller amounts of money than venture capitalists or other financing 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 as additional and future financing resources. They can assist in the professional development of your organization by helping you build your executive team and choose advisory board members. 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.
Benefits of angel investors:
Potential drawbacks:
Finding Angel Investors
You can start your search by asking your colleagues, accountant, lawyer, friends and family if they have any referrals. Many communities today have angel investing groups or clubs that meet regularly to collectively examine opportunities presented by budding entrepreneurs. You can find these networks by contacting your local Chamber of Commerce or looking in the telephone book. To broaden your horizons, try searching the Web using Google, Yahoo or any other search engine. Starting Point: www.investorscircle.net; www.tribeofangels.com
back to top
Page 11
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 financing companies have perfected their practices, they have expanded into the small business market. One popular form of ABF is invoice financing, where a financing company advances funds based on existing orders ensuring that borrowing is limited to funds that are in the pipeline. Lenders will advance up to 95% of an invoiced value. This can be an efficient way for a business to raise fast money. Asset-based financial 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 financial ratios which dont measure up to a banks requirements. These alternatives usually consist of asset-based loans, accounts receivable financing, and factoring.
Things to Keep in Mind:

Qualifying assets consist of: real property, A/R, equipment, finished inventory, and so forth. Some financial loans depend on a certain asset, although some function like a credit line collateralized throughout a mix of assets. Asset-based financing 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 sufficiently 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.creativefundingservice.com
Another NCHINC.com Success Story
Business Expanding Equipment Lease: One of our clients recently obtained a lease for $5,500 in Fitness Equipment which has allowed him to expand his Training business.
back to top
Page 12
6. Bank Line of Credit

A line of credit involves the bank setting aside designated funds for a business to draw against as needs 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 lines of credit typically have a higher interest rate than conventional loans, their rates are favorable when compared with credit cards. Helpful for managing seasonal, predictable, or industry-related cash flow variations and serving as 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. 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 sufficient 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-flow 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 significantly 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 flow. 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.bankofamerica.com; www.irwinunion.com

back to top
Page 13
7. Bank Loan
This is a term loan normally over a period of one to five 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 type of loan, it is advisable to approach multiple banks and let them compete for your business to make sure you get the best possible deal. What it takes to qualify: 1. Business name, names of principals, Social Security number for each principal and the business address. 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 profile: a short statement on each principal in your business, including background, education, experience, skills, and accomplishments. Market Information: 1. Clearly define your companys products as well as your markets. 2. Identify your competition and explain how your business competes in the marketplace. 3. Profile your customers and explain how your business can satisfy their needs. Financial Information: 1. Balance sheets and income statements for the past three years. If you are starting out, provide a projected balance sheet and income statement. 2. Personal financial statements on yourself and other principal owners of the business. 3. Collateral that youre willing to pledge as security for the loan.

Many financial institutions also need evidence of collateral. Collateral is necessary for all Small Business Administration loans, however the SBA doesnt automatically decline financing in which insufficient collateral may be the only undesirable element. Collateral is often company assets and personal assets outside the business. If you plan to purchase equipment and other assets with borrowed funds, you can assume that this will be used as collateral for the loan. Starting Point: www.wellsfargo.com; www.ibank.com; www.usbank.com
back to top
Page 14
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 flow. 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 make an offer to pay for the business over time; then use existing cash flow 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 financial loans if I get the funding to purchase the company? What cash flow 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 flow 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 financial loans used to buy the business? Can I make part of offer contingent on the future performance of the business? The key is to find motivated sellers willing to accept these terms.
Potential benefits:
The qualification process can be much less rigorous than traditional forms of financing. Youll be buying an established business with proven cash flow and avoid some of the pitfalls of a startup business. Youll have a track record and financials to approach a bank for more funding for expansion or other financial need.
Starting Point: www.sunbeltnetwork.com; www.businessbroker.net; www.bbnbrokers.com

A recent NCHINC.com client was approved for $13,900 for a tanning bed.
back to top
Page 15
9. Brokerage Firm Loans and Lines of Credit

Many major brokerage firms 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 firm than a traditional bank. This is because brokerage firms are regulated differently.
Potential benefits:
Get easy and efficient access to funds. Take advantage of competitive interest rates. Manage multiple loans in a single account; apply only one time. Choose from flexible 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 firm 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 on the LMA account. For fixed-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
back to top
Page 16
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 find the nearest economic development commission, simply consult your local Chamber of Commerce.
Key Benefits 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 financing. 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 partners who had worked as the General Manager, Parts Manager and Sales Director were able to pool their resources and buy the business they had worked at for 5 years. Because of the SBA requirement that only 10% down was needed they bought the business for only $40,000 down payment. $13,500 per individual and they now own the company and will be able to increase their personal income and create some job stability for them.
back to top
Page 17
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 technologybased 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 benefits:
Aid with business fundamentals. Business networking activities. Networking with strategic partners. Marketing and advertising support. Support with accounting and financial 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
back to top
Page 18
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 and universities, as well as corporations, government economic development agencies and non-profit organizations that support entrepreneurship, such as the Kauffman Foundation. While many do not charge 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 that summarize the plan by topic (product, market, competition, financing 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 significant preparation).
Helpful Hints:
Do your homework and select the opportunities that best align with your ideas. The web site of the 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 find 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 your data is current. If you wait too long, investors may not think you are serious.
Benefits
You can gain timely insight, feedback and support from potential mentors that will help you fine-tune your strategy and identify any flaws in your business model. You can get the attention of potential investors and/or partners who may be judging or guiding the 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 gain confidence 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
back to top
Page 19
13. Car Title Loans

A quick injection of business funding is available with a car title loan. These loans, for up to a vehicles market value, can be obtained through licensed lenders. Only available with a free and clear title, the main benefit 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 extreme caution 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 the car. 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 the title 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 than the value of the vehicle. If you are in need of emergency cash, there are much smarter choices to a car title loan. These alternatives include small consumer loans, and cash advances on credit cards. Starting Point: Search on Google for car title loans or payday loans.
More Success Stories at NCHINC.com

Lines of Credit for Their Businesses:
Steve has received $70,000 in one month alone! Between him and his business partner, they have Thor (by using a credit partner) received $80,000. Ronald has received $49,000 with more applications for funding still pending.
received $155,000 in total funding!
back to top
Page 20
14. Competitors
An interesting concept for raising money for a new business is to regard local competitors as a source of investment capital. Some business owners become entrenched in business models that work but are not necessarily efficient. They would welcome an improved working model, but after years of running the business a certain way, they find it difficult to make the change. If they are shown an innovative new approach, it might just get their attention. What could be better than having an investor who understands your business?
Begin With Competitive Research:

To gather competitive research, first 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 their business profits. Craft a letter that introduces your proposition to themmake the secret sauce (your new way to ()) vague you dont want to give away the secret until you have a financing arrangement. To create urgency mention that you are making the same offer to other businesses in your area and 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. Make enough offers and someone may welcome your proposition it could be just what they were waiting for. Starting Point: Local Yellow Pages or the Chamber of Commerce usually has a compiled list of businesses by your zip and surrounding areas.
back to top
Page 21
15. Corporate Take-over - Raiding the Franchisee

It is not uncommon for a poorly managed franchisee operation to lie about their royalties and underpay the 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 an enormous 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 franchisees would enter. This could be associated with great advantage to you, specifically fees paid to the franchisor in the current agreement are lower than such a brand-new franchisee would have to pay.
Important Tips
Discover why the leaving franchisee is leaving the company! He or she could be leaving the company because of bad, unstable relationships with the franchisor that could plague you as well. The particular purchase price for that current franchise is going to be something the leaving franchisee decides, or something the two of you figure 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 there any 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 for (geographical location) franchise for sale. Scan local classifieds online and off-line. Do drive-bys where many franchises are found look for closed sign during operation hours.
back to top
Page 22
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 first step is to set up your business as a separate organization, to separate your company credit user profile from your personal credit user profile. 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 find 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 profile.
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
back to top
Page 23
17. Credit Cards: Personal

Many entrepreneurs use their personal credit cards to finance their business at first. 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 affiliations. (Air miles, warranty extensions and bonus points for purchases.) Ones with universal use and low interest are the best choice for your personal finance. 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 finances, 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
back to top
Page 24
18. Craigslist.org
One innovative way of attracting investment into your business is to place an online classified 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 specific 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 financing 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.ebayclassifieds.com; www.usfreeads.com
back to top
Page 25
19. Direct Public Offering

Entrepreneurs nationwide are beginning to use the Direct Public Offering (DPO) as a creative form of financing. This is a public stock offering but differs significantly from the Initial Public Offering (IPO) or venture capital financing. 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 securities broker-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 financial reports Accurate and up-to-date stock information available to the public Audited financial 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 benefit of DPOs over IPOs is a dramatic decrease in cost. IPO underwriters
back to top
Page 26
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 confidential 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 difficult 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 profits.
Starting Point: www.virtualcapitalgroup.com
Doug obtained $75,000 in the 1st Phase - $30,000 from 1 lender at 0% for 12 months. Justine has received $82,000 & has one more application pending. William got an $80,000 capital infusion for his business.
back to top
Page 27
20. Economic Opportunity Zone Grants

Economic Opportunity Zone Grants, or Federal Government Economic Zone Awards, are available to anyone 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-sufficiency, 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 and making 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 job opportunities 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 improving transportation infrastructure.
SOURCE: www.HUD.gov
back to top
Page 28
21. Faith-based Initiative Grants

Faith-based initiatives are designed to support local communities. Established by the federal government, 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 help these organizations along with other similar ones. The main focus of these organizations is to work for the benefits of at-risk youth, the homeless and hungry, ex-offenders, medication addicts, well-being to work families and patients of HIV and AIDS. You will find 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 the grant.

When applying for the grant, the organization must keep in mind the amount they are going to receive 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 fulfilling the need is important at any cost. If your business is not given proper financial aid, theyll find themselves in the same position they were before you apply for the grant. In reality the grants or loans are available and provide sufficient amount of cash to fulfill the requirements and profit the organization who carry out the activities and the programs effectively. The federal government readily provides these types of organizations with funds so they will carry on their own social service activities. If youre connected with any of these organizations, you can apply for financial 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 nonprofit organizations that offer funds to this type of organization. You can make an application for as many grants as you wish. There is no limit in applying for faith based government grants and you only have to provide the proof of your organization. Starting Point: www.whitehouse.gov/government/fbci/grants-catalog-index.html
back to top
Page 29
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. Some programs are only available to certain minorities; some are targeted toward a certain industry or technology (such as alternative energy) and others are focused on economically depressed areas of the country. This source of business funding is worthy of investigation.
Potential benefits:
Grants are the best possible source of financing. 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 finance. Grants are not simple to come by, despite what some spam emails may say. Often, grants are made only if they benefit the community. As an illustration, there may be state or local grants for child-care centers, for several green projects or for an enterprise guaranteeing to produce jobs in an economically distressed area. For you to secure a grant, its essential to go through a rigorous application process and follow submission deadlines.
To discover more about grant opportunities at the state level, check with your states economic development agencies. Also find federal grant opportunities on the governments site. Contact local colleges. Some colleges and universities offer financial support to entrepreneurs through their small business and entrepreneurial centers. However, please note that grant requirements are strenuous, and theres much competition for small and home-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 financial advice. Consulting services are provided for these areas at substantially discounted rates as well by participating professionals. Check with your local city, Chamber of Commerce and Small Business Development Center to see whats available.
Starting Point: www.grants.gov

back to top
Page 30
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 finance 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 financial 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 of relatives, Christmas card lists and address books.

$85,500 for Paula $55,000 in one month alone!! Ollie got $64,000 for his business expansion. William has received $50,000 between 2 lenders and still has 4 pending applications!!
back to top
Page 31
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 significant funds from foreign investment. Attracting foreign investment to a business will take serious research and development to create a winwin 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 benefit 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 fit 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 efficiencies, 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/
back to top
Page 32
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 field 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 profitable 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 finishes. 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, you are going to have trouble franchising your notion. If you have a good product, a good market as well as plenty of flair, you need to search for some safety. Specifically, you need to have a strong trademark. The best franchises, such as Train and
back to top
Page 33
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.franchise.org

We substantially improved Rogers credit report in less than 60 days and he has received $55,000 between 3 lenders putting him at a total of $93,000 so far. Dave S. got $25,000 from one lender...plus some other approvals. Ed & Roby had some challenges (and some curve balls) but theyve stuck with it and done what we told them - $76,350 so far with more to come! Plus, $38,500 for Russ G. (through a credit partner).
back to top
Page 34
26. Garage Sale

One quick way to raise small amounts of money for a business launch is to hold a good old-fashioned garage sale. Gather all the wonderful treasures that have been hoarded for no obvious reason. Ask family 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 sugarcoat it and say that its a piece of cake. Find out if you can find any constraints your neighborhood or local government may have on lawn sales/ garage sales. Some areas may need permits and have a restriction on how many lawn/garage sales 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 sale ads. Advertise in your local paper, especially if your geographical area doesnt get much traffic. If you are 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 find 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 just point 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 largest employer in your community only will pay on the 1st of the 30 days (or whatever) then routine your yard sale for an added Saturday. Other people have explained the same regarding waiting till after the monthly Social Security checks turn out. Months before your backyard sale, begin gathering the items you want to market. Put all the items in a box in a some what out-of-the-way spot. If you dont recover something out of the box ahead of the sale, its probably secure to presume you dont want it. As you build up items for your sale, ensure you do not sell something that youll regret later.
In many cities there are businesses who specialize in selling your items on eBay for you. Itll save you time but will cost you in a percentage of the earnings. It may be a good alternative for the time strapped. Look in your Yellow pages for We Sell On eBay for you type ads. Starting Point: www.ebay.com; www.garagesalehunter.com; www.yardsalequeen.com
back to top
Page 35
27. Home Equity Line of Credit

Another quick way to get access to money for your business is to borrow against the existing equity in your home. Equity is the difference between the fair market value of your property and the mortgage amount owed. Home equity lines of credit allow you borrow up to 100% of the value of the equity held; however, interest rates charged on a home equity loan can be more than traditional mortgage rates so only borrow what you absolutely need.

Home-equity loans may be an attractive alternative to other forms of financial loans because they usually offer the least expensive interest rates available. However, you have to carefully consider all the outcome of jeopardizing your home to fund your business. Home equity loans can provide you with large amounts of money at a fairly low interest price, as well as particular tax positive aspects unavailable with other types of loans. But using a home equity loan to invest in your business carries notable risk. If your enterprise fails, youll have lost both your business and your home. Most mortgage organizations are happy to lend owners a portion of this equity without constraints on how we use the money. Refinancing isnt challenging, and if your credit history is good, you could have the cash within 1-month. Or you will get a commitment for your loan of your second mortgage loan and draw down the money as needed.
Potential risks:
You will find many frauds in this area, especially if your credit rating isnt A+. As before, keep in mind, if you default on the 2nd mortgage, it is possible to lose your property for a lesser amount than the value.
Starting Point: www.lendingtree.com; www.quickenloans.com; www.ditech.com
back to top
Page 36
28. Hard Money Lenders

Hard money lenders are companies offering a specialized loan secured with real estate. They provide short- term loans (sometimes called bridge loans) that provide funding based on the value of real estate that has been collateralized. The main drawback with these lenders is the interest rates they charge (significantly higher than those of a bank) however, they can usually make a decision to grant a loan much more quickly.

A hard money loan is an asset-based loan funded by property collateral. With hard money loans, the collateralized asset is a piece of real estate. The amount of the loan is actually assessed contrary to the quick sale value of the real estate. Hard money lending options use a loan-to-value percentage (LTV) of around 60 to 70% of the price that could be acquired for the house if it would have been on the market today. Hard money lenders are from private loan companies or lenders, and almost never from a deposit institution or even commercial bank.
The Benefits of Hard Money Loans

Individuals and businesses seek hard money loans because they dont satisfy the requirements for a bank loan. An asset-based loan are best-suited for people who need money quick or need a larger than normal loan. It can be favorable to individuals with poor credit. Hard money lenders have often been acquired for the same objective as bridge financial loans; to carry someone or company through a short-term cash shortage. Common uses for hard money loans are staving off foreclosure, covering payroll, and getting the amount of money for an enterprise start-up.
Some of the benefits of hard money loan are:

No Credit Check. Because the loan is guaranteed by the value of a hard asset - real estate - the credit rating of the borrower may be imperfect. This could be the reason debtors will seek hard money loans. A hard money loan often demands no credit score at all, or the lender will accept a reduced credit score (beneath 500).
Potential Risks:
Because any unregulated financial system can appeal to shady procedures, its important to confirm the good trustworthiness of your tough money loan provider. A red flag to consider to tell the difference between an excellent faith hard money loan company
back to top
Page 37
from predatory is whether the lender demands excessively high fees up-front. Hard money loans have features that are similar to conventional lending choices, but vary in many ways. Hard money loans are issued based on a fraction of the propertys value. In case you were to default around the loan, the amount of the loan can reach up to what the loan provider can expect to sell the property for if they need to do so rapidly. Since dangerous assets tend to be what protected hard money loans, you can expect having to pay a higher interest rate. In addition, you wont locate these loans offered by conventional lending institutions such as banking institutions. You will also need to exercise severe caution in choosing a difficult moneylender, as the business has hardly any regulation. If you need a loan issued quickly to yourself or for your business, getting hard moneylenders can be less difficult than finding a traditional loan, once you find the lender with whom youre comfortable. Rather than responding to the first ad which you see, you need to compare multiple hard cash loan alternatives at iBank.com. Based on the details that you provide, youll receive a list of lenders that could offer you the loan you asked for.
When to Borrow
Youre honest about your personal risk - Difficult money mortgages arent sources of free money. Theyre high-risk loans that can lead to you having your home repossessed. You should only take out a loan if you believe in your capacity to repay the credit. You consider unanticipated circumstances -- Dont take out a mortgage unless you have other methods to make the monthly premiums -- Should you or perhaps your spouse lose a job or perhaps struggle to work for a period. Starting Point: www.lendingassociates.net; www.ibank.com
Even More Success Stories at NCHINC.com

Nels W. has $75,500 in approvals and still has 2 more applications pending. Robert just got his first approval for $20,000 from one lender. $47,500 so far for Hayes J., with more to come. A new capital infusion for Yinka A., more than $74,000 in funding so far.
back to top
Page 38
29. Installment Loan Companies: Quick Cash

Installment loan companies are opening all over the country, providing quick cash that can be used in any way for personal needs. One company provides a $2,000 loan within one hour of application to just about anyone who holds a job and has a bank account. These loans are fine if you need some quick cash to get through a short-term financial challenge; however, be wary if you have longer term needs. The annual interest rate of these quick cash centers can be as high as 300% each year.
Potential benefits:
With instant money from an online payday loan, youll have money in your account even during those long stretches between revenue. Sometimes periodic expenses like automobile insurance, real estate insurance, or even real estate taxes take a bigger-than-usual nip out of your cash flow. Unpredicted things like unexpected medical expenses and automobile repairs would be the problem. Your business can have unforeseen expenses, too! Marketing budget overages. Manufacturing expenses, inventory and payroll obligations can strain a businesss cash flow. There are instances when instant cash from an Internet payday loan can help you stem the bleeding.
Some More Advantages

When you apply for instant cash from the payday loan, youll know exactly how much the fees tend to be before you accept the loan. Unlike credit card revolving debt that keeps adding interest monthly. Payday loans can save you fees. Avoid late fees. These can add up. No overdraft charges like a checking account. (Could be $40 or more for each instance!) Avoid negative credit entries on your credit file. This can mean more expensive loan rates in the future for your business costing you thousands. Keeping your bills and other financial debts current can save you money.
Key Things To Know

The funds are mostly transferred within 24 hours thus providing you instant relief from financial troubles. The quick approval is due to the fact there are usually no credit checks or faxing of documentation or paperwork. Short-term installment loans online offer an amount ranging from as low as $100 to as high as $1,500. Short-term installment loans are extended for a short period usually of 2 to 4 weeks only. In case you cannot repay your loan then the term can be extended by paying an extra fee. Short-term installment rates are for short duration only. These loans should not be your primary means of financing your business. Use them for emergencies and with a solid plan for paying them back on time. Starting Point: www.thinkcash.com; www.paydaymax.com
back to top
Page 39
30. Investment Bankers

Investment bankers help companies to raise money by issuing and selling securities in the primary market. They help businesses by helping them to raise money, both equity and debt, in the capital markets. They also provide strategic and advisory services for mergers and acquisitions and other types of financial transactions.

Investment bankers are banking institutions and people who aid organizations in raising capital, often through a personal placement or perhaps public offering of company stock. At times investment brokers are referred to as brokers or deal makers. Companies regularly use investment lenders to help recognize available financing alternatives and gain introductions to funding options. Some also look to investment lenders for assistance within building a business plan or prospectus to use in raising capital. Others look to them for up-to-date suggestions about the conditions associated with fundraising for private companies. They are able to be helpful to an organization in studying its funding needs, determining the most likely or proper sources for raising cash and carrying out a fundraising strategy.
Equity Financing:
One way is through equity financing where an organization sells partial ownership of the company to the public. That is typically carried out by and IPO where the shares are first introduced to traders. Debt Financing: Another type of loan is as financial debt financing. By means of debt funding, a company actually borrows money through investors via the selling associated with bonds. The organization must repay the full amount borrowed, when the relationship matures, combined with interest that has been agreed upon if the bond has been issued. Investment bankers can also be advisors to a business when coping with different types of purchases such as mergers and acquisitions. When a business uses an investment financial institution, the bank will prepare all the materials required for the transaction and the completion of the deal. The important thing is, an investment bank can make the process of raising money much easier for any company.
back to top
Page 40
There are several other ways an investment lender can promote securities for a company:
Firm Commitment- The actual investment lender will actually buy the securities from the company at an arranged price and then resell them to the public at a markup. The investment lender takes the danger here but could benefit significantly if the securities are highly revered by the public. Finest Efforts- The investment banker will do their finest to sell every one of the securities, however they do not ensure it. The organization takes the risk here since they will not receive as much funds if all the securities are not sold.

Many entrepreneurs prefer to raise funds without the assistance of an investment banker and look to investment bankers, instead, only when they prepare to take their companies public. The investment bankers ability to underwrite (or sell) the companys stock can make its services indispensable. Choosing the best investment banker to lead the underwriting of a companys initial public offering is an important part of conducting any successful public offering. Investment lenders who are experienced with the companys market and the kind of financing it needs, can often assist a company raise funds. But, when they are unfamiliar with the actual companys industry or perhaps the type of loans being sought, they may really hinder a companys financing.
Investment bankers charge for their services in a variety of ways.

They can look to receive some sort of success fee as part of their compensation that is typically computed as a percentage of funds raised. Engagement agreements with investment bankers can sometimes be complex and should be reviewed carefully before they are signed. Qualified legal counsel can help a company avoid unwanted obligations by reviewing the proposed agreement with company management.
Starting Point: www.vfinance.com/
back to top
Page 41
31. Investment Clubs

Over the past 10 years, investment clubs have grown in popularity all around the United States. Most clubs started for the purpose of sharing investment ideas between amateur investors in order for them to collectively make a profit on their investments. The groups invest primarily in publicly traded securities. Some clubs will invest in startups and existing businesses when they see an opportunity to make a decent return on investment. Business owners are often allowed to present new ideas to these clubs in an attempt to gain investment funding.
What is involved:
An investment club is a group of individuals who make a commitment to contribute a fixed sum of cash each month in to a common pool of funds, and then use that common pool to invest. Most commitments last for a period of a couple of years, with a payoff window at the conclusion of the 2nd fiscal year. Commitments range from as little as $50 each month to $1,000 per month.
For the investment club participants there are many benefits including:
Group investments to lower the overhead cost. More members have more ideas! You dont have to follow the news every day. The group will be large, and will have mechanisms to contact each other in the event of urgent market news requiring action. Ability to perform Hedging operations. Because of the large pool of money that will be collectively invested, the club will have the ability to use options to protect gains and minimize losses in the event of market swings. Tax deductions for expenses. Learn the techniques of the professionals. Meet and socialize with smart like-minded individuals. As a business owner seeking financing you can present your investment opportunity at a monthly meeting. You will need to arrange a time slot with the investment club in question and learn the way they like to be presented with opportunities. You may want to consider attending some meetings before you present your offer just to get a feel of what goes on there and how other business owners make their presentations. Choose a local or regional investment club when doing your research. You should network with the investors and make some friends too they may be more receptive to your opportunity when you present it. Investment clubs seem to be an upward trend in the finance world and can be a great alternative to tight credit markets. Starting Point: www.wfic.org; Google the term investment club + your state, county or metropolitan area.
back to top
Page 42
32. Initial Public Offering

An Initial Public Offering (IPO) is when a company sells stock in the open market for the first time. A business can raise huge amounts of money this way and in doing so creates a marketable stock for its investors. IPOs were a very popular way for new businesses to get started until the dot-com bust and subsequent government regulations for publicly traded companies. Some companies, such as Google and e-Bay, chose this method of raising capital.
What is involved:
An initial public offering (IPO) is the process by which a privately held company issues shares associated with stock to the public for the first time. Also known as going public, an IPO transforms a small business from the privately owned and operated entity into one that is possessed by open public stockholders. An IPO is a substantial stage within the growth of numerous small businesses, since it provides them with access to the general public capital marketplace and also increases their credibility and exposure. The decision to go public may also be influenced by venture capitalists or founders who would like to cash in on their own early investment. The ideal candidate for an IPO is a small-to medium-sized company in an emerging industry, with annual revenues of at least $10 million and a profit margin of over 10 percent of revenues. It is also important that the company have a stable management group, growth of at least 10 percent annually, and capitalization featuring no more than 25 percent debt.
Benefits of IPOs
The primary advantage a small business stands to gain through an initial public stock offering is access to capital. Another advantage IPOs hold for small businesses is increased public awareness, which may lead to new opportunities and new customers. Another advantage of going public involves the ability to use stock in creative incentive packages for management and employees.
back to top
Page 43
A public entity involves significant changes for a small business, though a lack of flexibility as well as control for management. IPOs fell out of favor in the fallout of the dot-com bust in 2001. With Facebooks IPO and other companies there seems to be a small resurgence, however, the heyday of IPOs is over and may never return.
Overall, going public is a complex decision that requires consideration and preparing.
FACT: It is not unusual for a small business to pay between $50,000 and $250,000 to prepare as well as publicize an offering. A key disadvantage involves the public companys loss of confidentiality, flexibility, and control. SEC regulations require public companies to release all operating particulars to the public, including delicate information about their own markets, profit margins, and long term plans. Experts recommend that small business owners think about all the other options first (for example securing investment capital, forming a restricted partnership or joint venture, as well as selling shares through personal placement, self-underwriting, or a direct public offering).
As you can see, going public probably is not right for the fledgling small business, but something to keep in mind as your business grows.
Starting Point: www.tcc5.com; www.artfieldinvestments.com
back to top
Page 44
33. Inventory Factoring

One method of coming up with cash for a business is to factor out inventories. Inventory factoring companies will step in and lend money to companies that have valuable inventories and then pledge those inventories against future sales made by the company. The factoring companies charge a healthy fee for their service but, if a business is struggling in a slow economy with inventories on the shelf or in the warehouse, they can get much needed cash from the factoring company to help to weather the storm.

Inventory loan financing (also known as Flooring) is the using of inventory value as collateral for a loan. Loan companies want to make sure their loans are secure, which means this method will improve the chances drastically of receiving money. Lenders and experienced business people understand that running out of stock will do absolutely nothing but turn customers away from a business. More and more loan companies are willing to permit a business to make use of their present inventory as collateral for future financial loans.
More Benefits:
It also allows distributors as well as resellers to stock inventory with extended payment conditions. Working capital position for the business is also increased. Also a key benefit is that it does not count against the businesss credit line. Have a good strategy in place before you speak with a lender about your inventory loan options. The fees for this type of financing are high. So you shouldnt make this a primary way to finance your business. Think of it as a short term problem solver.
Starting Point: www.factorhelp.com; www.factoringcenter.com

back to top
Page 45
34. Inheritances
Many people know they have been named as a beneficiary of a parent or grandparent and expect to inherit various assets when the time comes. Occasionally, relatives can be receptive to the idea of releasing a part of the inheritance while they are still living so that the money can be invested in a new or expanding business.
Things To Know:
(Yes! Its probably a taxable event. Check with your tax accountant beforehand.) Estate tax may apply to your taxable estate at your death. Your taxable estate is your gross estate less allowable deductions. Your gross estate includes the value of all property you own partially or outright at the time of death.
Your gross estate also includes the following:

Life insurance proceeds payable to your estate or, if you owned the policy, to your heirs; The value of certain annuities payable to your estate or your heirs; and The value of certain property you transferred within 3 years before your death.
Taxable Estate
The allowable deductions used in determining your taxable estate include: Funeral expenses paid out of your estate, Debts you owed at the time of death, The marital deduction (generally, the value of the property that passes from your estate to your surviving spouse), The charitable deduction (generally, the value of the property that passes from your estate to the United States, any state, a political subdivision of a state, the District of Columbia, or to a qualifying charity for exclusively charitable purposes), and The state death tax deduction (generally any estate, inheritance, legacy, or succession taxes paid as the result of the decedents death to any state or the District of Columbia. SOURCE: irs.gov
Where to find out more?
If you need more information, see the following publication, forms, and instructions. Publication 559, Survivors, Executors, and Administrators; Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return; Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return; Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return for Nonresidents, not a Citizen of the U.S.; and Form 1041, U.S. Income Tax Return for Estates and Trusts.
back to top
Page 46
35. Institutional Investors

Large insurance and pension fund managers deal with publicly traded businesses; however, a trend is emerging for this investor to identify smaller companies with a big potential for growth that can provide a quicker return for their investment. Getting the attention of a fund manager is a big challenge. One way to get institutional money into a business is to hire a financial representative with the right contacts who can open the door to huge capital for your business. Institutional investors are organizations which pool big sums of cash and commit those sums in investments, real property and other investment property. They include banking institutions, insurance companies, pension or pension funds, hedge money, investment experts and shared funds. Their role throughout the economy is to behave as highly specialized investors for others.
Rule 506 of Regulation Ds definition of an institutional investor:

A bank, insurance company, registered investment company (generally speaking, a mutual fund), business development company, or small business investment company. An employee benefit plan, within the meaning of the Employee Retirement Income Security Act, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets more than $5 million. A charitable organization, corporation, or partnership with assets exceeding $5 million. A director, executive officer, or general partner of the company selling the securities. A business in which all the equity owners are accredited investors; A natural person who has individual net worth, or joint net worth with the persons spouse, that exceeds $1 million at the time of the purchase. A natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year. A trust with assets in excess of $5 million, not formed to acquire the securities offered, whose purchases a sophisticated person makes. Because of their sophistication, institutional investors may often engage in private placements of securities, in which certain aspects of the securities laws may be inapplicable.

Institutional investors will have a lot of influence in the management associated with corporations because they will be eligible to exercise the actual voting rights inside a company. Many institutional investors act as intermediaries between lenders and borrowers. They have a critical importance in the functioning of the financial markets. There are mailing lists available of hedge fund executives on the Internet. Try http://lists.nextmark.com Starting Point: www.cii.org; www.institutionalinvestor.com
back to top
Page 47
36. Lottery Tickets

Here is a fun idea for all of you dreamers! There was an article recently about a woman who won a state lottery after applying the principles taught in the movie The Secret (a documentary about using the Law of Attraction that offers the knowledge of how to createintentionally and effortlesslya joyful life). The woman said the principles taught in The Secret had enabled her to manifest the winning ticket for herself. So if you want to try something different, check out The Secret and try to manifest your own winning lottery ticket!
Here are some more tips you can use

Strategy #1
Play lotteries with lower jackpots which have less players. This increases your chances of winning the jackpot. The higher the jackpot, the more competition.
Strategy #2 Strategy #3 Strategy #4
Never buy a Quick Pick ticket. Manual selection of numbers outpull computer created ones. Play games that award extra money or even prizes if your sequence, such as two sets in a row, earns you money. If youre playing a lottery that requires that numbers be received in a specific sequence, remember to box your selection. The numbers that can win can be selected in any order.
Strategy #5 Strategy #6 Strategy #7 Strategy #8
Play lotteries that provide a bonus for an additional number. Play the all of tickets that you can. This boosts your odds as well. Pool your money for playing the lottery with several other individuals. Try a wheeling system. Wheeling is a way for you to get maximum coverage from the numbers you play. Wheeling simply can help you span more numbers each time you play upping your odds of winning. This is a method you should consider once you have other more reliable financing strategies underway. Although the benefits of this method are compelling - No qualifying, no paperwork, no collateral needed, and no investors to satisfy; somebody has to win right? Starting Point: www.thesecret.tv; www.calottery.com; www.lottery.com
back to top
Page 48
37. Leasing Equipment

Lease financing is an alternative way to get business equipment rather than using scarce funds. There are many equipment leasing companies that provide this alternative. One great advantage is that it may be allowed to be off the balance sheet; meaning it does not appear as a debt of the business. An entire office can be set up with the help of the right leasing company with leases ranging from three to 10 years, depending on the life of the items being leased. Vehicle leasing is common in small businesses and is always welcomed by dealerships.
Some Advantages of Leasing Equipment:

Much less initial cost. The primary benefit of leasing business equipment is it allows you to acquire assets with minimal preliminary expenses, saving capital for other business needs. Simply because equipment leases rarely need a down payment, you are able to get the goods you need without affecting your cash flow. Flexible terms. Leases are often easier to get and have more flexible conditions than financial loans for buying equipment. This can be an advantage for those who have bad credit or need to negotiate a longer payment plan to lower your costs. Easier to upgrade gear. Leasing enables businesses to address the problem associated with obsolescence. If you use your lease to obtain items that may be outdated in a short period of time, such as computers or other high-tech equipment, the lease passes the burden of obsolescence onto the lessor. You are set free to lease new, higher-end equipment when your lease expires. Tax deductible. Lease payments may usually be deducted as business expenses on your tax return, lessening the net cost of your lease.
The Downside of Leasing Equipment:

Greater overall cost. Leasing a product is almost usually more expensive than buying is. You dont own it. You dont build equity in the equipment unless of course the equipment is becoming obsolete by the end of the lease. This lack of ownership is a significant disadvantage. Obligation to pay for whole lease term. You are required to make obligations for the entire lease period even though you stop while using the equipment. Leasing equipment can be a wise decision for business people who have small capital reserves or even owners who need equipment that must be upgraded every couple of years. Buying equipment can be a better choice for established businesses or for equipment that has a long life. Starting Point: www.ibank.com; www.fivepointcapital.com
back to top
Page 49
38. Letters of Credit

Letters of credit, also referred to as commercial letters of credit, have been used for centuries to ease payment in international trade. A letter of credit is a contractual agreement between a bank (known as the issuing bank) for one of its customers, authorizing another bank (known as the advising or confirming bank) to make a payment to the beneficiary. The issuing bank, on the request of its customer, opens the letter of credit and makes a commitment to honor the draw made under the credit. The beneficiary is normally the provider of goods and/or services. Essentially, the issuing bank replaces the banks customer as the payee. Letters of credit achieve their purpose by substituting the credit of the bank for that of the client, for the purpose of helping trade. There are basically two sorts: commercial as well as standby. The commercial notice of credit is the primary payment mechanism for a transaction, whereas the standby letter of credit is a secondary payment mechanism.
A Typical Letter of Credit Process:
1. Buyer and seller agree to conduct business. The seller wants a letter of credit to guarantee payment. 2. Buyer applies to his bank for a letter of credit in favor of the seller. 3. Buyers bank approves the credit risk of the buyer, issues and forwards the credit to its correspondent bank (advising or confirming). The correspondent bank is usually located in the same geographical location as the seller (beneficiary). 4. Advising bank will authenticate the credit and forward the original credit to the seller (beneficiary). 5. Seller (beneficiary) ships the goods, then verifies and develops the documentary requirements to support the letter of credit. Documentary requirements may vary greatly depending on the perceived risk involved in dealing with a particular company. 6. Seller presents the required documents to the advising or confirming bank to be processed for payment. 7. Advising or confirming bank examines the documents for compliance with the terms and conditions of the letter of credit. 8. If the documents are correct, the advising or confirming bank will claim the funds by: 9. Debiting the account of the issuing bank. 10. Waiting until the issuing bank remits, after receiving the documents. 11. Reimburse on another bank as required in the credit. 12. Advising or confirming bank will send the documents to the issuing bank. 13. Issuing bank will examine the documents for compliance. If they are in order, the issuing bank will debit the buyers account. 14. Issuing bank then forwards the documents to the buyer.
As a seller, make sure you:
Carefully review all requirements for the letter of credit before moving forward. Understand all the documents required. Can get all the documents required for the letter of credit. Understand the time limits associated with the letter of credit, and whether they are reasonable. Know how quickly your service providers (shippers, etc) will produce documents for you. Can get the documents to the bank on time. Make all documents required by the letter of credit match the letter of credit application exactly.
Starting Point: www.tradebeam.com; www.atradius.com

back to top
Page 50
39. License Rights to Your Product or Service

Another way to raise some quick cash for your enterprise is to license the rights to your product or service. Take your product to a distributor that would normally carry your product and sell them the rights to your unique widget. You never know who might be willing to pay for your great ideas. This is where you need to be a little creative. Licensing is the transfer of copyright from one person or group to another person or group, where all parties to the transfer benefit in some way. The licensing of products is a common form of licensing and happens more than most consumers would think.
A Pre-Presentation Checklist:
1. Find out the problem that needs to be solved. 2. Identify the product category. 3. Identify competitive items. 4. Identify the target audience. 5. Uncover market trends. 6. Discover market price points. 7. Identify possible corporations to target. 8. Gather necessary materials. 9. Determine manufacturing processes. 10. Create a product explanation. 11. Show the products appearance. 12. Create packaging. 13. Establish protection. 14. Outline a possible presentation timetable.
Key Points To Consider:

Businesses can license their products to manufacturers with a solid market share and the capacity to market these products to a target audience better than you could. Licensing can give a business the upper hand during future negotiations. If a business takes advantage of the right licensing opportunities, their future products will have a much better chance of being picked up and distributed to a target market. With licensing theres no debt to be paid back, no debt overhead burden, no qualifying, only profits to obtain and put to use in your business. Starting Point: www.perpetuallicensing.com; www.thetransactionalgroup.com; www.davison54.com
back to top
Page 51
40. Life Insurance Borrowing

Some types of life insurance policies accrue value in a savings account of sorts, from which you can borrow money. Once you borrow from your policy, you will be charged interest, to make up for the interest the insurance company is no longer making on the money you withdrew. The interest charged on policy loans is usually reasonable compared with other sources of lending. The loan stays in place as long as you continue to pay the insurance premiums.
Why Consider this Option:

Since you are borrowing your own money, you can use it for whatever you want. You do not have to repay the loan, so there is no set repayment schedule. You can also repay just some or all the loan (with interest). The interest rate is usually lower than other funding sources. You can usually borrow up to the policys entire accumulated cash value. You may also cash in your policy to receive the full cash value thats accumulated. If the dividends earned on the money remaining in your policy are greater than the interest on your loan, you can have them applied to the interest you owe to keep the loan balance stable.

Be cautious in your borrowing to ensure it will not jeopardize your beneficiaries security and welfare. Any amount taken as a loan, with any interest that accrues, is deducted from the policys total value in the event of death. Because you are taking a loan and not a withdrawal, you will be charged interest, and you may be faced with other fees during the process that increase the effective rate beyond what is stated. Even though you are not technically withdrawing money from your policy, the dividend you earn may be negatively affected by your loan. You must own the policy to take a loan. You need to make payments to cover the interest you owe or it will be added to the loan, increasing the amount of interest due. If the additional interest and loan amount end up being greater than the policys cash value, you risk losing your coverage. You need to have your policy for ten years or so for enough cash value to accumulate to make it worth your while. Keep in mind that, if you cash out your policy, a new one will cost you more based on your age and any health issues that have developed over time. There may be tax consequences for borrowing or cashing out your policy, so be sure to ask before taking action. You may want to calculate whether you can pay on your loan and continue to pay into your policy so the benefits are there for your beneficiaries in the case of unexpected death. Before calling your insurance company, look at your last annual policy statement to figure out the estimated cash value and plan on taking no more than 90% of that as a loan. You may also want to check with them to see when your dividends and/or other gains are credited to your account and wait and borrow after the deposit to get the maximum amount you can.
back to top
Page 52
41. Manufacturer Financing

A big initial outlay for any business is the purchase of equipment to run the operation. Fortunately, most equipment manufacturers offer financing for their products. Personal computers are a good example; companies like Dell will provide financing for this most fundamental need. If your business needs a heavy investment in equipment to get started, talk to the manufacturer or distributor about financing options. Youve made the decision to get your latest computer on finance - and why not, its going to do wonders for your cash flow and ensure you receive the latest device.

The first place you went when looking for finance would be your bank manager. Pc finance isnt any different - and your bank will undoubtedly be only happy to help. Beware of the hidden pitfalls. Banks will just lend your business a set amount - as well as any kind of lending it makes will count towards this. The current economic climate makes banks even tighter on their financing criteria. The taxdeductible leasing agreement, rather than a financial loan, could make much more sense.
Manufacturer Options:
Many manufacturers offer finance or even computer renting deals. Apple Company, for example, provides two choices to professional customers called Finance Lease as well as Residual Lease. If you are happy to be locked into a single manufacturer, it may be worth a look -- they often supply upgrade options as well, to ensure that you always have the latest IT equipment. But you will be limited to each manufacturers pc equipment, which means this may not be the best route to choose custom solutions, or where you need a piece of hardware the manufacturer cannot provide. Merchants have now entered this market too, though they cant match the professional finance companies for flexibility and high APRs are typical. Specialist computer finance companies can offer the best of the makers computer finance upgrades and the most versatile payment choices to match your business. Starting Point: www.dell.com; www.gateway.com
back to top
Page 53
42. Merchant Account Financing

This is a fairly new type of financing that quickly converts your future Visa and MasterCard sales into cash. This financing alternative to loans serves the needs of small businesses in ways that traditional business lenders cannot. Some firms will offer lump sums of up to $100,000 when you pledge a fixed percentage of your monthly credit card receipts to them in return. The amount you are eligible to receive will depend mainly on the monthly revenue your business typically brings in and the time you have been in business.
When to consider this option:

If If If If you need an instant influx of cash for paying bills, buying inventory, or growing your business you cant secure more traditional funds because of a low credit rating you dont want or cant afford to wait for approval of a traditional loan you dont have the collateral needed to secure traditional lending
Potential Benefits:
You receive cash, just as you would with a loan, yet you do not have to worry about making large monthly payments since a fixed percentage is taken from each credit card sale until the loan is paid off. There is no fixed timeframe for repayment. Since you pay based on the volume of business you are doing, you dont end up underwater in slower months. You can take advantage of opportunity as it arises since you can get an advance of this type quickly and easily. You receive a lump sum within a week of applying. There is limited paperwork to complete. There is no risk of losing collateral or impacting your credit rating since an advance is treated like a purchase as opposed to a loan.

Acceptance of credits cards from your customers as a means of payment Minimum credit card sales of $2,500 to $5,000 or more a month Minimum of 9 to 12 months in business Stable business performance (i.e., reliable income base) Starting Point: www.amerimerchant.com; www.merchant-cash-advances.com; www.crownfinancialservices.net
back to top
Page 54
43. Newspaper Ad
One simple way to attract the attention of local investors is to place an ad in your local newspaper under the classified section of business or investment opportunity. The author has seen many entrepreneurs take this simple but unpredictable route to raising capital. Your headline could read Local Entrepreneur Looking for Financial Partner to Make Millions or Discriminating Investors Wanted for a Unique Private Investment Opportunity. This approach may be a long shot but you never know who may be reading the paper that day.
Keep It Short
You should know that short advertisements work best. You want to keep your ad short so you can focus on producing response. Stay with short headlines, short entire body copy, and a short close. The purpose of your classified ad would be to gather a lead -- you shouldnt be trying to sell anything, so keep this in mind.
Go for Response
Go with the two-step approach to advertising: produce a lead, and follow up on this guide with more information.
Use Trigger Phrases

You will want to make use of keywords or trigger words that entice your prospective client on taking an action. Focus on what the investor gets, Solid Returns Fast Growth Investment Safe ROI. Use trigger words proven to improve response rates, and can do wonders for your classified advertising marketing campaign. Study the ads in your local and national newspapers for tips you can use to boost your response.
Starting Point: Investors Business Daily, Wall Street Journal or USA Today
back to top
Page 55
44. Other Peoples Money - OPM

A stretch Hummer seen often on the Las Vegas strip proudly displays OPM, the name of a nightclub. It is not hard to imagine the owners of this business had to go to great lengths to raise enough capital to open the club. Undoubtedly, they enjoy the irony of naming the club OPM. The great thing about using other peoples money for your business venture is that you dont have to tie up your own. Plus, if you have money to tap personally you always know it is there if times get tough. I always recommend using OPM except in cases where you give up control. Ownership is nothing, control is everything.
Key Advantages of OPM:

When you take a loan to make money, you use one of the most effective magic secrets recognized in the world today for building huge wealth. All you need is a good idea to complement the money youre lent and youre off on a glorious road to great prosperity - fast. You work harder and have a greater opportunity to hit it big time. With money in hand you can concentrate on the business aspects of each offer, improving your chances of success. Having money in the bank, even lent funds, gives you more confidence so you work relaxed as well as close more big money deals. Cash on hand can help you work better deals, thus you may be in a position to get big discounts at more favorable costs. Having money available may allow you to buy a company, buy supplies; or otherwise catch a deal while your competition is fumbling around to get the needed cash. It gives a person independence, freedom of motion, and the power to make the best deals for you. OPM can put you in a moneymaking state of mind, that is, you can earn more because you have more! OPM is the magic which builds wealth in every nation of the world - large, small, and inbetween.
back to top
Page 56
45. Product Advances by Suppliers

When a business is involved in selling products that are bought from others, it is in a great position to ask suppliers for product advances. Most suppliers are more than happy to advance their product when a business displays the ability to sell.
Types of Product Advances Include:

Consignment
When goods are delivered to another company with the understanding that payment for the goods is only made once the goods are sold. Consignment can cover just about any type of business. It is worthwhile for the seller of consigned goods, because they dont need to pay suppliers up-front.
Trade Credit
Trade credit is an arrangement between businesses to buy goods or services on account, that is, without making immediate cash payment. The supplier typically provides the customer with an agreement to bill them later, stipulating a fixed number of days or other date by which the customer should pay. It can be viewed as an essential element of capitalization in an operating business because it can reduce the capital investment required to run the business if it is managed properly. Trade credit is the largest use of capital for most business to business (B2B) sellers in the United States and is a critical source of capital for a majority of all businesses
Dropship
Dropshipping is a supply chain management technique in which the retailer does not keep goods in stock, but instead transfers customer orders and shipment details to either the manufacturer or a wholesaler, who then ships the goods directly to the customer. As in retail businesses, most retailers make their profit on the difference between the wholesale and retail price but some retailers earn an agreed percentage of the sales in commission, paid by the wholesaler to the retailer.
Use one or all of these popular financing techniques to free up capital for marketing and growing your business. Trade credit in its various forms should be your first goal in your business financing plan. Its easy to establish trade credit and will help you over the hurdles of early growth.
Starting Point: Check with all your vendors for available credit programs.
back to top
Page 57
46. Private Debt

A business can raise capital by offering a debt instrument to investors as opposed to an equity instrument. This can be done by a secured or unsecured promissory note obligation payable over time at a competitive interest rate. Investors consider private debt to be high risk, so interest above market rate is normally required to attract them.
Things To Keep In Mind:

Besides raising equity capital from investors a great number of private companies make use of the Regulation D Programs to boost private debt financing. Most early stage or even start-up companies do not have the capability in order to qualify for conventional bank funding because of rigid underwriting. Many entrepreneurs look for debt funding from private investors to capitalize their opportunity. Increasingly, debt financing from private investors using only a business plan is almost impossible. Business plans do not supply any helpful information on the ability of a business to perform.
Regulation D Debt Offering:

A Regulation D Debt Offering functions much like a private business loan where the company offers a promissory note to investors. The note sets the terms and conditions of the loan arrangement between your company and the investor. A note would provide a certain interest rate typically paid yearly to investors with a mature date which dictates when the principle is paid back in full.
Use Private Debt to Get Cheaper Financing Later

Many early stage companies that lack the needed equity or operating history for conventional financial institution financing will use private financial debt from investors for a short period of time (12 - 36 months) to determine a credit and operating history. Then they have the ability to take out the private debt loan from the investors with a standard bank business loan at a lower interest rate. Most companies use the programs to raise from $25,000 to $50,000,000 in capital. Regulation D Offerings have been used for a wide variety of transaction and industry types: corporate seed capital, corporate expansion capital, film production capital, real estate equity funding (acquisitions, development projects, golf courses, rehab), capitalization for early to pre-IPO stage Internet and technology companies, expansion funding for retail companies, and product development and distribution funding. Starting Point: www.promissorynote.org
back to top
Page 58
47. Private Placement

A private placement is a private way of raising money that targets sophisticated investors. These investors are accredited investors (see #3) which allows you to take advantage of exemptions in federal securities laws. By definition, this is the opposite of a public offering, and it needs careful compliance with Regulation D of the Securities Act of 1933.
Things You Should Know:

Private placement or private investment capital, is money invested in your organization usually through private investors in the form of stocks and sometimes bonds. In the United States, personal placement often does not need to be registered using the Securities Exchange Commission. Regulation D is easily the most popular form of non-public private placement. According to Thompson Financial, over 416 million was released in the personal placement market for 2002. Private placement will exist for the small business owner and is often less expensive and easier than taking your company open public.
Key Benefits of Private Placement:

High degree of versatility in quantity of financing which range from 100 thousand to 10-20 million with mixtures of debt, equity, or financial debt and collateral capital. Investors are more individual than venture capitalists, frequently seeking 10 to 20% return on investment over a long run of 5 to 10 years. Much lower costs than approaching venture capitalists or even selling the stock to the public being an IPO (Preliminary Public Offering). Quicker form of raising money than usual venture capital marketplaces.
What Youll Need:

A sound business plan A private placement memorandum (PPM) disclosing the full facts of the investment and business A law firm or lawyer experienced in private placements. Connect with bankers, attorneys, and accountants who can network your small business with a private investor. Starting Point: www.nyppe.com; www.tweisel.com; www.privateplacementletter.com
back to top
Page 59
48. Private Grant Programs

Similar to federal government grant programs, there are many non-profit organizations found throughout the US that offer cash grants to new and existing businesses. The programs are often focused on specific industries or on businesses that are starting up in economically disadvantaged communities.
What is involved:
Talk to your local Small Business Administration representative or economic development authorities to find out about local grants that may be available for your business. Contact local colleges. Some colleges and universities offer financial support to entrepreneurs through their small business and entrepreneurial centers.
Here is a checklist of the program information you need:

The nature of the project and how it will be conducted. The timetable for the project. The expected outcomes and how best to evaluate the results. Staffing and volunteer needs, including deployment of existing staff and new hires.
Here are the components of a good letter proposal:

Ask for the gift: The letter should begin with a reference to your prior contact with the funder, if any. State why you are writing and how much funding is required from the particular foundation. Describe the need: In a very abbreviated manner, tell the funder why there is a need for this project, piece of equipment, etc. Explain what you will do: Just as you would in a fuller proposal, provide enough detail to pique the funders interest. Describe precisely what will take place as a result of the grant. Provide agency data: Help the funder know a bit more about your organization by including your mission statement, brief description of programs offered, number of people served, and staff, volunteer, and board data, if appropriate. Include appropriate budget data: Even a letter request may have a budget that is a half-page long. Decide if this information should be incorporated into the letter or in a separate attachment. Whichever course you choose, be sure to indicate the total cost of the project. Discuss future funding only if the absence of this information will raise questions. Close: As with the longer proposal, a letter proposal needs a strong concluding statement. Offer to provide more details or meet with the funder. Attach any additional information required: The funder may need much of the same information to back up a small request as a large one: a board list, financial documentation, and brief resumes of key staff. Starting Point: www.foundationcenter.org; www.fundsnetservices.com
back to top
Page 60
49. Private Equity Fund

Private equity funds, like the one that bought Chrysler Motor Corporation recently, grow ever more popular. Public markets have not made the returns expected by investors therefore private equity funds have evolved to look for alternatives. There are many different types of private equity funds that make investments in new and small business and are worthy of further investigation.

A private equity fund is a collective investment plan used for producing investments in various equity (and to a smaller extent financial debt) securities according to one of the investment methods associated with private equity. Private equity funds are typically restricted partnerships having a fixed term of ten years (often with annual extensions). Institutional investors help to make an unfunded commitment for the limited partnership, which is then drawn over the term of the fund.

A private equity fund is actually raised and managed through investment professionals of a particular private equity firm (the general partner and investment advisor). A single private equity firm will manage a series of distinct private equity funds and will make an effort to raise a new fund every 3 to 5 years as the prior fund is fully invested. Nearly all investors in private equity are passive and rely on the manager to make investments and generate liquidity from those investments. Typically, governance rights for limited partners in private equity funds are minimal. Most private equity funds are structured as limited partnerships and are governed by the terms set forth in the limited partnership agreement or LPA. These funds have a general partner (GP), which raises capital from wealthy institutional investors, such as pension plans, universities, insurance companies, foundations, endowments, and high net worth individuals, which invest as limited partners (LPs) in the fund.
Starting Point: www.privateequityinfo.com; www.peinsider.com
back to top
Page 61
50. Personal Savings

An obvious start to any new business is to begin with your personal savings. The benefit of using your own cash for a business startup is that you keep control and are not committed emotionally to anyone but yourself. Giving up any control of your business may be a necessary evil to attract investors, but keeping other people out of your business is a less stressful way of operating.

If you are starting or buying a small business, your personal savings can be an important resource. This is the opposite of OPM Other Peoples Money. Most new businesses are started when business owners or partners dip into their own checking and savings accounts to put together the financing needed to start up, purchase or expand their business. Many times business owners and partners will liquidate savings held in stocks and bonds to be able to come up with the needed capital. Also common is the practice of borrowing funds from personal credit cards and taking out personal loans to ease the raising of funds required. While tapping into your credit cards may be an option it is not advisable to do so for long-term financing. The money drawn down on your personal credit cards shows up on your credit history and can affect your credit scores since it increases the amount of revolving debt that you have outstanding versus the total available to you. You can use this money to invest in your new business or you can use it to pay your living expenses during the early stages of your business venture. Its also a good idea to keep some money as a cushion in case you have to pay unexpected expenses.
Starting Point: Check your savings, checking, and CD accounts for available amounts. Review your stock, mutual fund and bond holdings for available value.
back to top
Page 62
51. Private Parties

There are many wealthy investors who seek unique opportunities for financial gain. The challenge is to find them. Begin by asking all your contacts. Talk to your lawyer, CPA, banker, minister, realtor, financial planner, doctor and anyone else you can think of. Become a walking, talking business promoting machine. You may be surprised how quickly you can find someone suitable to approach about your business investment opportunity. Based on the SBA, around 250,000 angel investors in this country invest roughly $30 billion annually, most of this in seed, start-up and early stage ventures. The early-stage entrepreneur thus has an increased likelihood of raising funds from angel investors, and from professional venture capital close ties. You should create a business plan which underlines your sustainable aggressive advantage. Its rare that an entrepreneur raises capital through private investors without having clearly defined the aggressive landscape of his company and how his solution includes a clear competitive advantage beyond others in the market. Investors will want to know the barriers to entry for your endeavor how you will keep rivals from being in the same exact business. Some obstacles to admittance might consist of: patents, trade secrets and proprietary technological development or answer. You should accept having a good idea is often not enough to raise capital through private investors, and you ought to do your homework to provide proof of concept for the venture. The existence of a prototype or working type of your companys product or service can greatly increase your chances of attracting angel investors in the prototype stage of your business should be borrowed by yourself, buddies, and loved ones. Angels are impressed when you have arranged potential customers who are willing to check or test your product as well as commit to buy it, should it solve their difficulties. An entrepreneur who is able to demonstrate he can create paying customers within the real world is far ahead in terms of raising from angels compared to an entrepreneur who simply has a business plan as well as an idea. If you have decided to raise capital for your venture, you will improve your chances for success if you employ professionals to help you with the procedure. This requires budgeting for specialists, as well as the real process of making and mailing business plans, travel, telephone and FedEx. You should determine and get in touch with angels who are ideal for you.
back to top
Page 63
Angels have various investment requirements:

Deal size: Angel investors, becoming individuals, tend to know the investment size with which they are comfortable. The entrepreneur shouldnt be surprised to locate that most angels invest anywhere from $25,000 to $250,000. Syndication of angels is a common process for those entrepreneurs, needing to raise capital, beyond the individual amounts of most angels. Organization stage: Some angels will only purchase seed or start-up companies, while some seek later on stage ventures looking for expansion capital. The entrepreneur and their professional advisor should look to find individual angels whom tend to be well-suited to the stage associated with development of the venture. Business: Angels invest in businesses these people either know and/or can readily understand. Many angels, having previously been successful entrepreneurs, will often lean toward their earlier industry encounter. A deal well-matched towards its potential angel investors will have a higher possibility of a successful closing. Most angels see themselves as value-added investors meaning that they gain as much personal satisfaction through helping a brand-new business owner because they go through contributing funds to the venture. Many were previously successful business owners.
Angels bring with them value added benefits including:

1. Prior industry experience 2. Valuable knowledge about business itself 3. Their ability to mentor 4. Creative ideas 5. Connections for your company.

You should never stop searching for additional angel investors until all checks through interested parties have cleared the bank. You should invest your own money in your own venture. If you wish to start a company, be prepared to invest your own money. You should place at least 20% of your own net worth within your business. Individual entrepreneurs who are not prepared to assume this kind of risk arent considered serious entrepreneurs through the investment community, and will not likely receive any financing. Starting Point: Read your local newspaper classifieds and national ones as well; advertise your investment opportunity; www.craigslist.org
back to top
Page 64
52. Payroll Advance Companies

These companies are similar to installment loan and car title loan companies, but they will advance funds based on your current payroll amount.
Who can qualify for a payday loan?

Most lenders will want the following:
You must be employed or receive regular income from a program such as social security or welfare. If employed, you must make at least $1,000 per month or $800 if you receive income through a government program. You must be 18 years old, as well as a citizen of the United States You must have an active savings or checking account that allows for direct deposit.
What about repaying my payday loan?

Lenders have a few repayment options available should you not be able to pay back your loan amount and fees on the expected repayment date. Please note that these options may vary depending on the lender. Option A: You may pay your loan amount back only and roll the finance charges into a separate loan. Option B: You may pay the finance fee and part of the loan amount back, rolling the remainder into a separate loan. Option C: You may pay the finance fee only and roll the full loan amount into a separate loan. Its important to note that additional rules and limits may apply in each of these, so be sure to ask your loan representative about your options.
Starting Point: www.paydayone.com; www.powerpaydayloan.com
back to top
Page 65
53. Purchase Order Factoring

Purchase order factoring companies provide a much-needed source of capital for businesses that have to outlay large amounts of cash to purchase or manufacture their products. The factoring company provides the necessary operating cash to keep the company afloat until orders are fulfilled. They secure their position by requiring the business to pledge future sales revenue to them. Purchase order factoring, sometimes called contract funding, is great for businesses requiring financing during times of growth. Cash flow reserves often turn out to be insufficient, and additional financing resources are needed. The issue comes when suppliers want a business to pay upfront by way of C.O.D., and also the buyers want to buy the products on Internet 30-60 day conditions. This means there isnt any incoming money during manufacturing while the goods are in transit, and until the bills have grown up. Purchase order factoring solves this problem if you are paying for the cost of the goods directly to your supplier for the manufacturer or even distributor. Purchase order factoring frees up your cash for other important business expenses for example paying for resources or advertising.
Before applying for purchase order invoice discounting there are several things that should be done:
Get a purchase order from your customer. Look for a reliable supplier of your products. Place the purchase with that provider.
No matter what type of financing your company is seeking you should have a good plan written down which shows how much money is required. Lenders like to know that youve got a plan, and itll increase your likelihood of getting approved. Starting Point: www.facteon.com; www.alliedcapitaldirect.com; www.bridgeportcapital.com
back to top
Page 66
54. Reverse Mergers

One way to speed up the process of getting to capital available in the public markets is to do a reverse merger. A reverse merger occurs when a company wants to go public but does not want to take the time or have the expense of doing it in the traditional way. Instead they merge the current company with a publicly traded shell company. This is an expensive method but it can speed up the process of a company going public.
What is involved:
A reverse merger is a technique by which a Private Company or an unincorporated business goes open public. In a reverse merger, a Private Company merges with an existing Public Organization with no property or debts. By merging into such an entity, a Private Company gets public. The Private Company merges right into a Public Company and acquires the majority of its stock. The actual Private Company normally can change the name of the Open public Company (frequently to its own name) and will appoint as well as elect its management as well as Board of Directors.
The Private Company, which has gone open public, obtains the benefits of public trading of its securities:
Elevated liquidity from the ownership shares of the company. Higher share price and thus higher company value. Greater access to the capital markets through the possibilities of a future inventory offering. The power of the company to make acquisitions of other companies using the corporations stock. A chance to use inventory incentive intends to attract as well as retain crucial employees . Going public can be part of the retirement technique for business owners. Going public can be part of a strategy to lower the percentage associated with share possession by the sale of shares to the open public by the current owners therefore converting ownership to cash for pension or other purposes.
back to top
Page 67
The benefits of going public through a reverse merger, as opposed to an Initial Public Offering, are:
The costs tend to be significantly less compared to costs necessary for an initial public offering. Time needed is less compared to an initial public offering. Another danger is in an IPO in that the Initial public offering may be withdrawn because of an unstable market condition even after most of the up-front costs and considerable management period have been expended. IPOs generally need greater attention from top management. While an initial public offering requires a relatively long as well as stable earning history, the possible lack of a generating history wont normally keep a privately-held organization from completing a reverse merger. The organization does not need an underwriter. Theres less dilution of ownership control. You will get a higher valuation for your company.
Requirements just before entering the reverse merging are the following:
A Private Company will require approval of its stockholders for any merger with a public company Once a company is public via a reverse merger, the real estate markets hold the following future potential customers in the capital markets for the new Public Company. The market value of the Public Organization is often substantially higher than a personal Company with the same structure within the same business Capital is simpler to raise with regard to public companies because the inventory has market price and can be traded The public trading price of the Public Corporations securities can serve as a benchmark for the offer price of a subsequent public or even private securities offering Acquisitions can be made along with stock since publicly traded stock is viewed as currency for mergers as well as acquisitions Stock can be released for officers, directors as well as consultants If the stock distribution has included warrants, the new company can receive proceeds from the exercise of those warrants if the trading price of its common stock exceeds the exercise (strike) price of warrants. Starting Point: www.flexfinancialgroup.com; www.artfieldinvestments.com
back to top
Page 68
55. Home Refinancing

Home equity can be a large source of quick cash for any type of business startup or expansion. Many people have locked in equity in their home either because they have been paying off a mortgage for many years or because the home has increased in value. It is relatively straightforward to refinance through your favorite bank or mortgage broker and free up the amount the business needs. There are two clear advantages. First, mortgage interest rates are some of the lowest available. Second, the interest paid is tax deductible.

Home equity loans can provide you with large amounts of cash at a fairly low interest rate, as well as certain tax advantages unavailable with other types of loans. These can be an attractive alternative to other types of loans because they usually offer the lowest interest rates available. Quite a few of us have established equity in our homes, sometimes tens of thousands of dollars of equity. Most mortgage companies are happy to lend owners a portion of that equity with no constraints on how we use the money. Refinancing isnt a struggle, and if your credit rating is good, you can have the cash in hand within 30 days. Or you can get a commitment for the loan of a second mortgage and draw down the money as needed.
Potential risks:
Consider all the ramifications of risking your home to fund your business. Using a home equity loan to fund your business carries considerable risk: If your business fails, you will have lost both your business and your home. There are tons of scams in this area, especially if your credit isnt A+. And keep in mind, if you default on the second mortgage, you can lose your home for much less than the value. Starting Point: www.lendingtree.com; www.eloan.com; www.ditech.com
back to top
Page 69
56. Related Businesses

Existing business owners are naturally curious about other peoples businesses. So, you may find that they are a great target to approach for investment funds. The group most likely to be interested will be those in a related field that are wishing to diversify. Lets say, for example, that you want to start a landscaping business and need an investor. You should consult with home builders, concrete contractors, pavement companies or any contractor involved in home building or improvement. They already understand the market, your customer, and the challenges of being contractors who service home owners, so it will not take them long to make a decision about the viability of your business ideas and whether they want to get involved.
The BIG question: What do your customers buy either before or after your product?
Make a list of the products or services your customers need in addition to yours. What other businesses cater to your customers? Compile a list of businesses from the above questions. Get your Yellow pages, business directories, online search engine and find all the businesses that could make a good investor candidate.
Start by opening a new Excel worksheet and creating the following columns outlining your related businesses:
Name (and location if relevant). URL Products and services offered. Contact information. Postal address, phone, e-mail.
Next,
Create a compelling and interesting proposition to present to them. Craft a letter that introduces your proposition to them. To create urgency, mention that you are making the same offer to other businesses in your area and will make a decision based on the terms of the arrangement. Starting Point: Local Yellow Pages or the Chamber of Commerce usually has a compiled list of businesses by your zip and surrounding areas.
back to top
Page 70
57. Personal Retirement Plan: Loans

If you are a part of a company sponsored 401k plan, you may be allowed to borrow up to 50% of the vested value. Repayment is required within five years and you will be charged interest. Some companies only allow loans of 401K money to be used in the case of emergencies. Talk with your administrator to discover how your plan works and the conditions for borrowing from your current plan.
Keys To Borrowing from Yourself:

If you have a 401(k) Plan, you may be in a position to borrow against the money you have been contributing. About 90 percent of 401(k) programs allow financial loans. If your plan allows you to borrow against this, you can get more than $50,000 but not more than 50 percent of the complete amount inside your account.
There are many benefits of 401(k) financial loans:

Fast approval. Because you are borrowing your personal money, the approval process is more or less the formality. Attractive interest rate. Most 401(k) loans interest rates are fixed at a rate throughout the loan. No limit on how you apply the funds. In contrast to loans from conventional sources, you can use the cash for whatever purposes you see fit. When you make loan payments, the funds, minus the interest, return to your 401(k) account.
One downside is that obligations must be created on schedule and the loan must happen within the designated time frame or else you may be susceptible to paying taxes on the money and a 10% penalty charge. If your business idea isnt solid and proven you could be risking your retirement money and have to pay more than you borrowed.
Starting Point: Your employers 401k literature and www.irs.gov
back to top
Page 71
58. Personal Retirement Plan: Cash

If you still have money in a 401k plan of a former employer you can cash out of that plan in order to get access to the money for your business or business idea. There is a 10% penalty and you must pay income tax on the money received, so this choice can turn out to be expensive.

Any amounts are subject to normal taxation as ordinary income. To preserve the tax advantage for income deferred into a 401(k), the law stipulates the restriction that unless an exception applies, money must be kept in the plan or an equivalent tax deferred plan until the employee reaches 59 years of age. Money that is withdrawn before 59 typically incurs a 10% penalty tax unless a further exception applies. This penalty is of course on top of the ordinary income tax that has to be paid on such a withdrawal. The exceptions to the 10% penalty include: the employees death, the employees total and permanent disability, separation from service in or after the year the employee reached age 55, substantially equal periodic payments under section 72(t), a qualified domestic relations order, and for deductible medical expenses (exceeding the 7.5% floor).
This is an option you should keep in mind while you pursue other possible sources of financing. While the expenses associated with this strategy are high, the potential return you could have with a business of your own could give you a superior investment advantage. With todays economic environment and with other countries as an example; government could make off with a portion or all of your retirement savings. Using it for this purpose before they come for it could be a wise decision.
Starting Point: www.irs.gov
back to top
Page 72
59. Retirement Plan Funding-OPM

Individuals you know who have self-directed IRAs can also be a source of funding for your new enterprise. There are limits on certain individuals investing in your business from their IRA, termed disqualified persons. Disqualified persons are yourself, your spouse and your direct descendants; otherwise, you can approach any friend or investor for this type of funding. Some of the extra investment options permitted under the regulations include real estate, stocks, mortgages, franchises, partnerships, private equity and tax liens. Property may include residential and commercial properties (U.S. & Internationally), farmland, raw land, new construction, home renovation, development, and unaggressive rental earnings. Real estate bought in a self-directed IRA may have a mortgage placed against the property, thus decreasing the amount of complete cash needed for a purchase; however, neither the IRA nor the actual account owner of the IRA might have personal liability on the mortgage. Business investments may include close ties, joint endeavors, and private stock. This can be a system to fund a start-up business or other for-profit venture that is managed by someone other than the actual account who owns the IRA.
The following are banned transactions with an IRA:

Borrowing money from it. Promoting property into it. Receiving unreasonable compensation with regard to managing it. Using it as security for financing. Buying home for personal use (existing or future) with IRA funds. IRS rules prohibit dealings that are an improper use from the value within the account or annuity by the account owner, the accounts owners beneficiary, or any other disqualified individual. These rules are generally designed to prevent self-dealing. Disqualified persons include your fiduciary as well as members of your family, such as your spouse, ancestor, lineal descendant (the children, grandchildren, great-grandchildren, etc.) and any spouse of a lineal descendant).
Other disqualified persons include:

Service providers from the IRA (e.g., custodian, CPA, financial planner) A good entity (like a corporation, relationship, limited liability company or estate) of which 50% or more is owned directly or indirectly, or even held by a fiduciary or service provider. An entity that is a 10% or more partner or even joint venturer of with an entity that is 50% or more owned directly or not directly or held by a fiduciary or service provider. Try networking with self-employed people who will more apt to have self-directed IRAs. Start a list of potential contacts from business associations, golf clubs, business seminars and other groups that have self-employed people. Also classified ads in newspapers and online can help you find potential investors. Starting Point: www.irs.gov
back to top
Page 73
60. Retirement Plan Business Financing-Personal

A newer strategy being deployed by some baby boomers is to use funds locked away in retirement plans while avoiding the penalties associated with cashing in. Anyone who has money in a 401k plan (at a company where they no longer work) or a personal IRA can roll those funds into a newly created corporations retirement plan. The business owner starts a corporation, opens a corporate retirement plan, rolls the existing 401k/ IRA money into the new plan then has this retirement plan purchase the stock of the corporation. This method provides initial capital to the business that can be used to purchase a franchise, an existing business or to fund a startup.
Steps To Rolling Over Your 401k/IRA:

1. Check Rollover Eligibility together with your old 401(k) Provider
Before you do anything, seek advice from your old provider. You need to make sure there wont be any unexpected snags or even fees and ensure that youre showing up as a previous employee.
2. Obtain Rollover Forms through Old Employers
In most cases, you will need to submit paper forms in order to start a rollover, so youll wish to tell them that you intend to move the money over, and that you want the types needed.
3. Observe What is Required for the New Provider
Next, youll want to check with your new account provider to see the things they require in order to accept the actual rollover. Whether its a new 401(k), brokerage accounts, or mutual fund company, each may have their own unique, but similar process.
4. Complete the Forms Properly
This is an important action, especially if youre doing the work on your own. All of these forms might have a lot of information, and to make sure it goes as smoothly as possible, youll want to make certain you fill it out correctly. If in doubt, ASK.
5. Submitting the Forms and Follow-up
Once finished, its time to submit the forms. You need to remain on top of this. There is a nasty habit of providers making it difficult for individuals to pull their money out. Dont wait for them to respond take action yourself and call the firm and start asking questions. Its your responsibility until the funds have been transferred.
Starting Point: Search your current providers website for rollover information. Find the proper forms youll need.
back to top
Page 74
61. Royalty Advances

If you are in the business of writing books, publications or educational materials that have mass appeal, you may be able to approach publishing houses for royalty advances. Publishers are constantly looking for new and exciting materials and will often offer advances to secure the copyright. The disadvantage is that you lose control over the use of the material unless you are able to negotiate the terms when the advance is agreed upon. With intellectual property licensing, an advance against royalties is a payment made by the licensee to the licensor at the start of the period of licensing (usually immediately upon contract, or on delivery of the property being licensed) which is to be offset against future royalty payments. In some business areas (e.g. film production) it is common practice for the licensee to demand repayment of any advance that is not covered by royalties, whereas in others (e.g. book publication) this practice is unusual. E.g., a books author may sell a permit to a publisher in return for 5% royalties on sales from the book and a $5,000 progress against individuals royalties. In this case, the writer would instantly receive the $5,000, and royalty payments would be withheld until the publishers takings from selling copies of the book reached $5,000, after which point the 5% royalty would be paid on any extra sales. Funding is fast and easy--cash advances usually take about one week. If you want to keep complete ownership of your royalties, you should request a cash advance. Your royalties will be only temporarily assigned until your advances have been paid back. In many cases, you may pay off your loan completely or partially at any time WITHOUT any prepayment penalty.
Cash Out for an Upfront Sum:

You can get more cash than an advance by selling your royalties. You can cash out but you lose your copyrights. (As in Michael Jackson buying The Beatles songs.) This method allows you a large, upfront cash payment. If youre in the creative field this can be a good start to launching your career. It can also haunt you if you completely sell your royalties away. Think this method through before you sign. Starting Point: www.advanceroyaltytracking.com; www.americanadvance.com
back to top
Page 75
62. Royalty Financing

Royalty financing occurs when an investor buys a percentage of a future revenue stream of a company. This type of financing can be risky for the investor if there are no current sales revenues or revenues do not occur for a time. When sales do occur, payment to the investor takes priority over all other company expenses, regardless of profitability. Royalty financing is a relatively new concept that offers an alternative to regular debt financing (loans and trade credit) and equity financing (venture capital and stock sales). In a royalty financing arrangement, a business receives a specific amount of money from an investor or group of investors. The money might be put toward launching a new product or expanding the companys marketing efforts. The investor receives a percentage of the companys future revenues over a certain period of time, up to a specific amount. The investment can be considered an advance to the company, and the periodic percentage payments can be considered royalties to the investors.
Things To Know:
The investor buys a percentage of your companys revenues in contrast to the more traditional method of buying a percentage of ownership in your company, and therefore profits/income. The investor gets paid regardless of the profitability of the company, and gets paid first, before taxes, debt service, and interest. The investor even continues to get paid if the company declares Chapter 13, a reorganization under the bankruptcy code. If there are sales, the investor gets paid. This is important to keep in mind when considering this type of financing. Obviously this kind of financing is only appropriate for companies that have a high gross margin or low cost of goods sold. Its also easy to oversubscribe the companys revenues and it can make obtaining more traditional debt financing or an equity investor much more difficult.
back to top
Page 76
Where To Find Potential Investors:

Royalty financing is a little harder to find than more traditional financing. Start with your accountant and attorney. Ask your Small Business Development Center. Try your Chamber of Commerce and your bank. Search your local newspapers or business paper.
Key Advantages of Royalty Financing:

Compared to equity financing, royalty financing enables entrepreneurs to obtain capital without giving up a significant ownership position in the company to outside investors. Royalty financing resemble loansand are not subject to state and federal securities laws as some equity financing deals are. Royalty financing also increases a companys ability to structure deals with individual investors, who might be attracted to the idea of receiving a monthly or quarterly yield over the life of their investment. Compared to debt financing, royalty financing provides more convenient payback terms and less severe penalties for default. Check out: www.advanceroyaltytracking.com; www.capitalroyalty.com
back to top
Page 77
63. SBA Microloans 7(m) Program

The Small Business Administration (SBA) introduced the SBA Microloan in 1992 to increase the availability of funding for smaller startup businesses. The loans are administered by non-profit organizations that serve communities in nearly every state. Loans are available up to $35,000 and have to be repaid within six years. Microloans are relatively easy to obtain compared with bank loans.
Potential benefits:
The U.S. Small Business Administrations 7(m) Microloan program provides short-term loans of up to $35,000 to small businesses and not-for-profit child-care centers for working capital or the purchase of inventory, supplies, furniture, fixtures, machinery and/or equipment. Proceeds cannot be used to pay existing debts or to purchase real estate. The SBA makes or guarantees a loan to an intermediary, who in turn, makes the microloan to the applicant. These organizations also provide management and technical assistance. The loans are not guaranteed by the SBA. The microloan program is available in selected locations in most states.
Why Consider this Option:

SBA Microloans are generally designed to target low- and moderate-income micro entrepreneurs, particularly the so-called un-bankable population that has had little to no contact with the mainstream financial services industry. Typical Microloan clients have either no credit history or a poor credit history, lack of collateral and a lack of business longevity, making them unqualified for more traditional commercial debt financing. Successful Microloan clients, given appropriate financing and technical assistance, have built successful firms that improved their own standards of living while also creating needed jobs in low-income communities. Previous administrations have tried to cut this program due to budget constraints. Refer to SBAs website for its current status. Starting Point: www.sba.gov; www.microloan.org
back to top
Page 78
64. SBA LowDoc

SBA LowDoc is the SBAs quick and easy loan program that provides a guarantee on small business loans of $150,000 or less. A one-page business loan application form must be completed and the agency processes applications within 36 hours. The most popular type of financial assistance from the Small Business Administration was with the agencys Low Documentation (LowDoc) Plan, a derivative of SBAs long-established assured loan plan. This program was terminated in Fall August 2005....may it rest in peace. Initiated in 1993, LowDoc expedited the actual procedures for obtaining SBA guarantees on commercial loans under $150,000. Problems regarding bureaucratic delay as well as protracted loan approval procedures had been reduced so that processing time for a LowDoc plan was usually less than 36 hours. Nevertheless....the Small Business Administration Express Program was made long term. SBA Convey loans require no documents the from Small Business Administration and the turnaround time to the lending institution is actually alleged to become 24 hours. Check out the Express loan option here. Keep in mind that usually the warranty on these financing options is only 50 % so the loan provider has a smaller amount of an incentive to use this form.
See the SBA ExpressLoan Program below. Starting Point: www.sba.gov; www.cadda.com
back to top
Page 79
65. SBA Express Loan

The SBA Express Loan allows a new or existing business owner to borrow between $10,000 and $350,000 with maturities of up to 25 years. The borrower must personally guarantee these loans that are funded by participating banks and lending institutions by pledging available business and/or personally owned assets.
Details of the Loan

Loan Amounts $10,000 - $350,000 Guarantee is 50% of loan amount Prepayment penalty may apply Terms Working Capital - up to 7 years Equipment Loans - up to 10 years Real Estate - up to 25 years
Express & Pilot Programs

SBAs Express and Pilot Programs offer streamlined and expedited loan procedures for particular groups of borrowers, notably active duty military personnel, veterans, and borrowers from distressed communities.
SBAExpress
The SBAExpress program gives small business borrowers an accelerated turnaround time for SBAs review. You will receive a response to your application within 36 hours. In addition, lower interest rates are often available to you when you apply through an Express program.
Patriot Express
The U.S. Small Business Administration has announced the SBAs Patriot Express Pilot Loan Initiative for veterans and members of the military community wanting to establish or expand small businesses. The SBA and its resource partners are focusing additional efforts on counseling and training to augment this loan initiative, making it more accessible and easy to use.
back to top
Page 80
Eligible military community members include:

Veterans Service-disabled veterans Active-duty service members eligible for the militarys Transition Assistance Program Reservists and National Guard members Current spouses of any of the above The widowed spouse of a service member or veteran who died during service or of a serviceconnected disability
Patriot Express loan proceeds can be used for most business purposes, including:
Start up costs Equipment purchases Business-occupied real-estate purchases Inventory Infusing working capital Managing your business Expansion Preparing your business for the possibility of your deployment Setting up to sell goods and services to the government Recovery from declared disasters.
Starting Point: www.rapidadvance.com; www.sba.gov
back to top
Page 81
66. SBA Export Working Capital Loans (EWCL)

The EWCL provides short term loans to small businesses for export related transactions. Under the EWCL program, the SBA can guarantee up to 90% of a secured loan on amounts of up to $750,000. The best way to find out if your business is qualified for this type of program is to make an appointment at your local SBA office to discuss the details and qualifications.
Export Loan Programs

SBA has placed a priority on helping these small business exporters by providing a number of loan programs specifically designed to help them develop or expand their export activities. If you own or wish to start a small export business, the following loans may be available to you: Export Express Loan Program Export Working Capital Program (EWCP) International Trade Loan Program Export Express ProgramFast and easy loans for small exporters Small business exporters are taking advantage of the world market and selling billions of dollars of goods and services overseas every year. In fact, 70% of all exporters have fewer than 20 employees. If you are one of these businesses, or would like to join in this growing trend, and you think you are too small to receive government sponsored export financing, think again! Streamlined financing up to $500,000 SBA Export Express offers flexibility and ease of use to both borrowers and lenders. It is the simplest export loan product offered by the SBA and allows participating lenders to use their own forms, procedures and analyses. The SBA provides an answer in 36 hours or less.
Who is eligible to receive Export Express financing?

Any business that has been in operation, although not necessarily in exporting, for at least 12 full months and can demonstrate that the loan proceeds will support its export activity is eligible for Export Express.
What can the loan funds be used for?

Loan proceeds may be used for business purposes that will enhance a companys export development. Export Express can take the form of a term loan or a revolving line of credit. As an example, proceeds can be used to fund participation in a foreign trade show, finance standby letters of credit, translate product literature for use in foreign markets, finance specific export orders, as well as to finance expansions, equipment purchases, and inventory or real estate acquisitions, etc.
back to top
Page 82
How do I apply?
Interested businesses should contact their existing lender to determine if they are an SBA Express lender. Lenders that participate in SBAs Express program are also able to make Export Express loans. Application is made directly to the lender. The lenders use their own application material in addition to SBAs Borrower Information Form. Lenders approve the request and then submit a limited amount of eligibility information to SBAs National Loan Processing Center. Export Working Capital Program (EWCP) - SBAs Role in Export Financing Many banks in the U.S. do not provide working capital advances on export orders, export receivables or letters of credit. Because of that, some small businesses may lack necessary export working capital to support their export sales. That is where an SBA program can make the difference. SBA provides lenders with up to a 90% guaranty on export loans up to $5 million as a credit enhancement, so that the lenders will make the necessary export working capital available. The SBA delivers its export loan program through a network of SBA Senior International Credit Officers located in U.S. Export Assistance Centers throughout the country. These specialists understand trade finance and are available to explain SBAs export lending programs, the application process and forms and to guide exporters in selecting appropriate payment methods. They can also link companies to specialists for increasing export sales and managing foreign payment risk. Exporters can apply for EWCP loans in advance of finalizing an export sale or contract. With an approved EWCP loan in place, exporters have greater flexibility in negotiating export payment termssecure in the assurance that adequate financing will be in place when the export order is won.
Key Benefits of the EWCP

Financing for suppliers, inventory or production of export goods Export working capital during long payment cycles Financing for stand-by letters of credit used as bid or performance bonds or down payment guarantees Reserves domestic working capital for the companys sales within the US Permits increased global competitiveness by allowing the exporter to extend more liberal sales terms Increases sales prospects in under-developed markets which have high capital costs for importers Contributes to the growth of export sales Low fees and quick processing times Starting Point: www.sba.gov; www.exim.gov
back to top
Page 83
67. SBA 7(a) Loan

SBA 7(a) loans are the most basic and commonly used type of SBA loan. The government guarantees the lender up to the percentage of the SBAs guarantee portion of the loan, allowing the lender to offer loans to business owners who may not otherwise be eligible under normal lender requirements. Repayment for this type of loan is based primarily on the business cash flow. The loans can be used for almost any type of business expense and range from $50,000 to $2,000,000. This type of loan on real estate only requires the owner to occupy 51% of the property. The 7(a) Loan Program includes financial help for businesses with special requirements. For example, funds are available for loans to businesses that handle exports to foreign countries, businesses that operate in rural areas, and for other very specific purposes.
Special Purpose Loans Program

SBA offers several special purpose 7(a) loans to aid businesses that have been impacted by NAFTA. To provide financial assistance to Employee Stock Ownership Plans. To help implement pollution control mechanisms.
Export Loan Programs

Approximately 70 percent of all U.S. exporters have 20 or fewer employees. SBA has placed a priority on helping these small business exporters by providing a number of loan programs specifically designed to help them develop or expand.
Rural Business Loans

Rural Lender Advantage The Small/Rural Lender Advantage (S/RLA) initiative is designed to accommodate the unique loan processing needs of small community/rural-based lenders by simplifying and streamlining loan application process.
Use of 7(a) Loan Proceeds

If you are awarded a 7(a) loan, the loan proceeds may be used to establish a new business or to assist in the acquisition, operation, or expansion of an existing business.
back to top
Page 84
Eligible Use of 7(a) Loan Proceeds Include:

Advantage Loan Initiatives
Small Loan Advantage and Community Advantage 7(a) Loan Initiatives SBA is committed to expanding access to capital for small businesses and entrepreneurs in underserved communities so that we can help drive economic growth and job growth.
Community Advantage Approved Lenders

The following are the Community Advantage lenders approved by SBA: ACCION in San Antonio, TX, Appalachian Development Corp in Greenville, SC, and Black Business Investment Fund of Central Florida, Inc. in Orlando, FL
Express & Pilot Programs

SBAs Express and pilot programs offer streamlined and expedited loan procedures for particular groups of borrowers, notably active duty military personnel, veterans, and borrowers from distressed communities.
SOURCE: sba.gov
Starting Point: www.sba.gov; www.sba7a504.com
back to top
Page 85
68. SBA 504 Loans

The SBAs 504 loan programs are designed to help growing businesses acquire long-term, fixed-rate financing for major fixed assets such as land and buildings. These loans cannot be used for working capital or inventory. The 504 loans can be as large as $5,000,000 and have maturities of up to 20 years. The owners personal guarantee is required on 504 loans as well as all other SBA loan programs.
What is the CDC/504 Program?

The CDC/504 loan program is a long-term financing tool, designed to encourage economic development within a community. The 504 Program accomplishes this by providing small businesses with long-term, fixed-rate financing to acquire major fixed assets for expansion or modernization. A Certified Development Company (CDC) is a private, nonprofit corporation which is set up to contribute to economic development within its community. CDCs work with SBA and private sector lenders to provide financing to small businesses, which accomplishes the goal of community economic development.
Typically, a CDC/504 project includes:

A loan secured from a private sector lender with a senior lien covering up to 50 percent of the project cost A loan secured from a CDC (backed by a 100% SBA-guaranteed debenture) with a junior lien covering up to 40 percent of the project cost A contribution from the borrower of at least 10 percent of the project cost (equity) This type of setup means that 100% of the project cost is covered either by contribution of equity by the borrower, or the senior or junior lien.
How 504 Loan Funds May Be Used

Proceeds from 504 loans must be used for fixed asset projects, such as:
The purchase of land, including existing buildings The purchase of improvements, including grading, street improvements, utilities, parking lots and landscaping The construction of new facilities or modernizing, renovating or converting existing facilities The purchase of long-term machinery and equipment The 504 Program cannot be used for working capital or inventory, consolidating or repaying debt, or refinancing.
back to top
Page 86
Eligibility
To be eligible for a CDC/504 loan, your business must be operated for profit and fall within the size standards set by the SBA. Under the 504 Program, a business qualifies as small if it does not have a tangible net worth in excess of $7.5 million and does not have an average net income in excess of $2.5 million after taxes for the preceding two years. Loans cannot be made to businesses engaged in speculation or investment in rental real estate.
Maximum Debenture (Total Amount of Loan)

The maximum SBA debenture is $1.5 million when meeting the job creation criteria or a community development goal. Generally, your business must create or retain one job for every $65,000 provided by the SBA, except for small manufacturers which have a $100,000 job creation or retention goal. The maximum SBA debenture is $2.0 million when meeting a public policy goal.
These include:
Business district revitalization Expansion of exports Expansion of minority business development Rural development Increasing productivity and competitiveness Restructuring because of federally mandated standards or policies Changes necessitated by federal budget cutbacks Expansion of small business concerns owned and controlled by veterans (especially servicedisabled veterans) Expansion of small business concerns owned and controlled by women SOURCE: www.sba.gov Starting Point: www.504blog.com; www.sba.gov
back to top
Page 87
69. SBA SBICs: Small Business Investment Companies

The SBA sponsors an equity investment program known as the Small Business Investment Corporation (SBIC) which is a series of privately owned investment funds licensed by the SBA. Essentially, the SBIC program is a public-private partnership designed to inject capital into emerging companies. With the SBA contribution, the SBIC funds can leverage their private investor dollars significantly. They are SBA sponsored venture funds that may or may not have a debt element.
General Information:
The SBIC Program is one of many financial assistance programs available through the U.S. Small Business Administration. The structure of the program is unique in that SBICs are privately owned and managed investment funds, licensed and regulated by SBA, that use their own capital plus funds borrowed with an SBA guarantee to make equity and debt investments in qualifying small businesses. The U.S. Small Business Administration does not invest directly into small business through the SBIC Program. Only companies defined by SBA as small qualify for SBIC funding. Generally, the SBIC Program identifies a company as small when its net worth is $18.0 million or less and its average after tax net income for the prior two years does not exceed $6.0 million. All of the companys subsidiaries, parent companies and affiliates are considered in determining the dimensions standard as well as for certain industries alternative size standards might apply. Details regarding regulating size restrictions are included in the Small Business Dimension Regulations.
SBICs may not invest in the following:

Other SBICs, financial and investment businesses or finance-type leasing companies, unimproved property, companies with less than 51% of the assets and employees in the United States, passive or even casual companies (those not engaged inside a regular and continuous business operation), or companies that will use the proceeds to acquire plantation land. SBICs may not provide funds for a small concern whose primary company activity is actually deemed contrary to the public curiosity.
back to top
Page 88
There are more than 300 licensed SBICs in operation these days. SBICs pursue investments in a wide range of industries and geographies. Some SBICs invest in a particular field or even industry by which their administration has knowledge, while others invest more generally. The SBIC plan currently offers its licensees use of debt funds with a 10-year maturation and semi-annual interest payments. The framework of this financing means that most SBICs focus totally on providing small businesses with debt or debt with equity functions. SBICs will usually focus on companies that are old enough to create current interest payments on the investment to ensure that, in turn, the actual SBIC can meet its interest obligations towards the SBA.
SOURCE: www.sba.gov
To learn more about other financing options available through the U.S. Small Business Administration, refer to the Loans and Grants section or call 1-800-UASK-SBA (1-800-827-5722). Starting Point: www.sba.gov
back to top
Page 89
70. Selling Collectibles

You know those old coins, comics, baseball cards, or stamp collections that have been sitting in your closet for years? Well, they just may be a way to raise capital for a new business. The value of collectibles can be surprising. There are many cases where collections have sold for tens of thousands of dollars. Antiques are another source of potential cash. Whether inherited or just picked up along the way, they can have incredible cash value and can be sold as easily as putting an ad on e-Bay or in your local newspaper.
Tips for Selling on Auction Sites:

Get picture right even if it requires a few tries. Always take your picture towards a plain background - youre selling the item not your own surroundings. You do not need a expensive camera with lots of lenses a digital camera will do the task. Within the title you receive eighty characters to describe your item, so use them sensibly. Put the color, make, size, what the product is, if you have characters left make use of adjectives - eg: fab, fairly, sexy, beautiful, retro, classic, great. Get your item description right. List using bullet points rather than one lengthy paragraph. Describe the item - what is it, how tall is it, how large, what is its condition. Think about what you would like to know about an item and answer individuals questions in your description. Dont be scared to price a bit higher as you can easily reduce prices. Buyers dont always purchase the cheapest listed item should you and another seller sell the same item. Decide if you need to sell to the US only or Worldwide. You can receive a lot of customers this way. Don be overwhelmed by buyers abroad as long as you pay enough for your postage, you are fine.
Starting Point: www.atoncer.com; www.onlinecollectibles.com; www.livedeal.com; www.ebay.com
back to top
Page 90
71. Silent Partners

Many businesses take on a silent partner to help provide the money that a business needs to get started or to grow. A silent partner is an investor who has no management responsibilities but provides capital and shares liability for any losses experienced by the business in return for a share of the profits. Their liability is limited to their investment in the business. Some silent partners can also offer a valuable business insight and experience to the owner of a business. Silent partner is a business partner who provides capital but does not take part in the management of the company.
Know These Things Before You Approach a Silent Partner:

What will the capital be used for
Commercial lending. Equipment financing. Commercial real estate finance. Start-up financing. Bridge financing. Expansion financing. Other financing. How will the partner be compensated? What will be their return? When will they see their return? What is the exit strategy for your partner?
Knowing these things and more will help you find a willing silent partner and will relieve their doubts as to your abilities because youve thought out all their concerns ahead of time. Network with your relatives and business associates and ask if they are willing to be your silent partner. If not, ask for referrals. Check with your golf buddies and other social gatherings where successful businesspeople hang out. You can also advertise with classified ads both offline and online. Starting Point: Your local paper business section or www.craigslist.org
back to top
Page 91
72. Second Job

If all else fails, getting a second job may be a way to get the required startup capital. Hard work is the cornerstone to any successful business, so if a second job today will help raise the money you need to start a business tomorrow, it should be regarded as a sound investment. Consider a job in your potential new business industry. You can make important contacts with vendors, management people, competitors to be aware of and some employees you can hire. Youll gain industry insights only being in the trenches can bring.
Keep In Mind:
The money you get for your second job should be put away for financing your new business. Its not an ATM you can use for the next electronic gizmo or getaway vacation. Find safe and high-yield investment vehicles to make your nest egg grow. Use investments that can be quickly liquidated when the time is right to launch your business. You dont want your money tied up in long-term investments.
Get Started:
Make a list of your job skills. If those skills include jobs that can be done at home as a virtual worker consider using a job board like www.eLance.com and others. This gives you time flexibility and keeps you at home to further plan your new business.
More Tips:
Register on online job sites. Also take a look at your local paper online listings. Use social networking sites to your advantage. Make a special professional Facebook, Twitter, MySpace, LinkedIn, Bebo etc. account particularly for your work. Network. Join associations, and clubs connected with your career. Lead from your strengths. If you know what you are skillful at, or above average, or just brilliant at ... then move through that region first. Mitigate your weaknesses. Play down your weak points. Avoid those activities that you are not so good at, or generally dont like doing.
Starting Point: www.monster.com; www.hotjobs.yahoo.com; www.snagajob.com; www.linkedin.com
back to top
Page 92
73. Selling or Licensing Patent Rights

You may be in a position to finance your new enterprise with an invention. Once you have patented your innovation you can sell or license its use. As the owner of the patent, you can be confident of keeping control; no one can steal it for their own use without being served with a lawsuit. Simply present your patented invention to businesses that stand to gain from its manufacture, sale or utilization.

Lets say you have a promising venture idea but find yourself without the money or experience to produce as well as market the product or even service. You have the option of licensing the actual patent rights for your intellectual property to some company instead of starting your own business. A license is really a formal contract made between an inventor (the licensor) and a company (the licensee). The creator gives a company certain privileges to produce, market, sell and/or make use of his or her invention or idea in exchange for either royalties from revenue or a fixed payment. Sometimes it makes more sense to license an item to a company that currently makes comparable products. If you can market your idea to a well-known company that currently makes something similar you may do better than if you launch a whole brand-new enterprise. If the invention works in the marketplace, and when you have a well-structured licensing agreement, licensing can be very profitable. If you think certification is right for you, incorporate your licensing strategy in your strategic business plan.
Advantages:
Both beginning a company as well as manufacturing an item involves a lot of time, cash, responsibility, as well as risk. By licensing your venture concept you transfer all of those responsibilities and dangers to another person. Licensing is fantastic for the person or even team that wants to keep inventing rather than starting and running an organization. Work out the terms of your permit carefully. Dont give away the store through granting an exclusive worldwide license for all uses with low minimum obligations, rather than a number of non-exclusive licenses for individual that utilizes sensible minimums for each.
back to top
Page 93
Dont create undue limitations on the licensee, as it could become impossible for the product to become profitable.
Finding the right company or companies:

Do your homework to determine what companies may best produce, market and sell your product or service. Identify businesses that have items similar to items you are suggesting. Eliminate companies where your product would compete with any of the products the company is already producing. Go to the library and consult the actual Thomas Registrar of American Manufacturers, trade publications, Standard Prices and Data, and/or the Dun & Bradstreet Million Dollar Database. Figure out which companies would be most interested in your products and can produce and sell this most effectively. Check the companys position on the Fortune 500 list of the most successful businesses in the United States and check its ranking on the Standard and Poors listing. This type of research is essential for discovering reputable companies that have the capacity and customer-base to both create and sell your product.
Starting Point: www.litmanlaw.com; www.uspto.gov; www.idea4invention.com
back to top
Page 94
74. Selling Business Assets

Existing businesses often find themselves with assets that can be sold to raise money to grow their business. There may be inventory and equipment with a significant sale value that has been unused for years. Look around for anything unneeded or not in current use and determine whether it can be sold. If it can, do so. Besides bringing cash into the business, you will free up space on your premises.
What is involved:
Selling company assets, even a division of your company, is a tried-and-true method of increasing capital. You might have equipment thats not being used or perhaps a building and land which has a higher value to someone else than it does to you. You can sell a whole product line that doesnt fit well with your corporations focus. Marketing intellectual property such as patents, formulas, customer lists, or industry secrets.
If youre considering selling real physical assets:

Stuff you should be aware of when selling high-value property on eBay:
Talk to your buying partner. Numerous dollars and also the potential for litigation are all at stake, so understand who youre dealing with and know your product well. Seek advice from an expert. Valuing a piece of expensive business equipment is something you want to research. Though there was a time when most people assumed (and may happen to be correct) that youd be crazy to buy a new car or a house on eBay, those times tend to be over. Large property can and do sell in large quantities every day on auction web sites, often to the great shared benefit of buyer and seller. If youre thinking about this method and have the resources to achieve success in it, do not hesitate-jump in and join everyone else. Keep in mind, property auctions are non-binding.
Starting Point: www.liquidation.com; business.ebay.com
back to top
Page 95
75. Selling Personal Assets

Starting any new venture will require cash, with some businesses requiring more than others. The author is a firm believer in keeping as much ownership control of the business as possible. Therefore the more ways money can be raised without having to go to others the better. What about your motorcycle, old collector car or that piece of land you inherited from your grandpa? If you are serious about starting a business and raising the necessary capital, dont let sentiment hold you back. Spring-cleaning is a good thing to do all year long. Make a list of all the things you havent used in the last six months. Electronics, second cars, recreational vehicles, clothes, antiques, assets from a previous business, appliances, second homes, vacation homes, stocks and bonds etc. Research and put a value on your list of assets (for each item). Research quick sale pricing for these items. Choose the proper venue for selling your items whether its an online auction site, a real estate broker, business broker, classified ads and so forth. Set a goal to raise all the capital you can by a certain date.
The good news is your life will become less complicated and organized now, and you can buy new and better stuff when your business succeeds.
Starting Point: www.ebay.com; www.ubid.com; www.bidz.com; www.craigslist.org
back to top
Page 96
76. State Government Grants

There are state government grant programs available to help fund new and existing businesses. In the farm belt states, grants are available to businesses that introduce new ways to use farm products such as alternative uses of crops. There are also some states in the rust belt seeking to attract new business as well as offering special grants and incentives to existing businesses for moving into economically depressed areas. These programs are different for every state, so contact your state economic development agency for details. Grants are the very best possible source of financing. 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 finance.
What it generally takes to qualify:

Grants are certainly not simple to come by, despite what some spam emails may say. Often, grants are made only if they benefit the community. As an illustration, there may be state or local grants for child-care centers, for several green projects or for an enterprise guaranteeing to produce jobs in an economically distressed area. For you to secure a grant, its essential to go through a rigorous application process and follow submission deadlines.
Grants By Cities And Local Organizations

Grants by cities for local redevelopment projects or restoration projects are occasionally available to qualifying businesses. These grants for the most part are for established businesses located in economically depressed areas. Tax Credits and Services in lieu of Cash Many cities and states offer tax credits for a variety of programs, including training of employees and efforts to increase employment. There are also free services provided in the areas of business planning, marketing, and financial advice. Consulting services are provided for these areas at substantially discounted rates as well by participating professionals. Check with your local city, Chamber of Commerce and Small Business Development Center to see whats available. The key to making this financing work is to be flexible to where your business is located, what type of business you are in and having the persistence to make it happen. Starting Point: www.grants.gov
back to top
Page 97
77. Tax Return Refunds

This may seem like a small and unlikely source of business capital, but it could be the start you need to get the fundamentals in place such as incorporating, buying business cards and printing letterhead. Never underestimate the power that comes with a few business cards. It is essential for a business to have credibility right from the start.
Tips To Get Started:

Maximize your potential tax refund amount by using all the legal tax deductions and strategies you can. Small Businesses Overpay the IRS by an Average of $11,638! Get better at tracking expenses. You will need every penny of breaks you can find, so buy that mileage log and create a companywide strategy for keeping track of receipts. Reduce your taxable income in whatever way youre able--defer earnings into an HSA or into next year, or make charitable donations. Things your IRA or 401(k) using the maximum permitted for your grow older and situation. Sock money aside. Whatever you paid last year, imagine youre going to pay more in the next year. Begin a monthly savings program so that you dont have to all of a sudden come up with a large sum of money in April. Maximize your non-capital losses. Non-capital losses may be used to offset additional personal income in any 12 months, can be transported back 3 years, or transported forward for up to seven years. Maximize your charitable income tax credit. To maximize your altruistic income tax credits, consider giving more to the registered charities of your choice this season. There are more small business tax strategies to assist you to maximize your company income tax deduction and reduce your taxable earnings. Strategize with your tax pro. If you do not work with a CPA yet, this might be a good year to begin. Theyll remain on top of the tax changes that may occur throughout the year and may advise you on your best course of action. Starting Point: www.irs.gov
back to top
Page 98
78. Trade Credit

Trade credit exists when one firm provides goods or services to another with an agreement to bill them later or to be paid later. This can be a great way for a start-up business to get access to product without paying up front. Many wholesalers will offer trade credit to get their products offered for resale in new outlets. Trade credit is generally extended for net 15, 30 or 60 day terms, during which time the supplier lends you their products or services for that period of time with an expectation of payment at the end of the term. Trade credit comes with specific terms for repayment, and generally offer discounts for early repayment. Always ask suppliers about their trade credit terms.
Reasons to Establish Trade Credit:

It helps you establish business credit and build your business credit rating. You can meet the needs of your business without collateral. It can help with cash flow concerns while reserving loan options for major needs.
Benefits:
No interest is normally charged and, if it is, the rate is generally less than other alternatives like credit cards. No collateral is required. Applications are short and easy to complete.

While many small companies try to stretch out their payables by paying after the due date, this does not make for good relationships and may well be putting another small business in a bind. It makes sense to try to negotiate terms up-front to ensure your credit rating and sourcing is not negatively impacted for the future. Favorable payment terms are a lot more likely when you have built a good relationship with a regular supplier. Vendors will typically look at your companys credit report (and often your personal one) in deciding to extend trade credit so make sure you check these out yourself before applying with them. Depending on the amount you are buying, vendors may still need a deposit up-front, with the balance due under the terms of your credit arrangement. The business world is a small world. If you are behind with some of your vendors, others may well find out and opt not to extend payment terms.
Options to Explore:
Ask your vendor to extend their terms for a longer time if you have a considerably larger order than usual. Offer them the opportunity to be your sole provider if they give you extended time to pay. Provide them access to your business plan and history of customer orders to help persuade them your new business will be successful and is worthy of a break. Pay a slightly higher price in exchange for longer terms. (CAUTION: It may be hard to reverse this pricing structure when your cash flow improves and you no longer need the extended terms.) Convert your payable(s) into a loan (i.e., note) from the vendor. Offer them equity in your company to remove outstanding payables. Offer to trade off discounts available for paying quickly in exchange for a longer payment timeframe. Permit your supplier to hold a lien on materials or products provided as collateral for extended payment terms.
back to top
Page 99
79. Venture Capital

Most venture capital comes from groups of wealthy investors, investment banks and other large institutions. Venture capital is a type of private equity capital typically provided to new, growing businesses, in exchange for shares in the company. Venture capitalists investments are typically high risk and so require a large percentage of a companys ownership in return. Many successful companies like Google, Yahoo, e-Bay and Amazon have taken advantage of venture capital at some point in their development. This form of fundraising is more common within new companies that have no operating history. Angel investors can be a good source of funding for brand-new businesses. Theyre often willing to take on more risky ventures than banks and they often invest for extended periods of time than other investors -- up to 5 years or more. However, theyll commit a maximum of $1 million. Venture capitalists invest much more, but they have tougher investment requirements and look for high-growth companies that will provide them the greatest potential profit. Theyre typically seeking to cash out in three to five years. So the majority of them arent interested in really young businesses. They almost always want a bit of your company and a seat on the board of directors, which could lessen the amount of control you have over your company.
So how do you find out who is great and who is not?

Venture capital firms are easy to check on: reputations of the much better firms are well known to experienced attorneys and accounting firms. Actively research before you act by making telephone calls and talking to others knowledgeable in the community. You should be looking for insight into the personality, intelligence, as well as objectiveness of the venture capitalists. You need to interview the CEO of selected portfolio companies associated with prospective investors in your company.
The all-important questions you should ask and understand before choosing to work with venture capital firms include:
Do the venture capitalists uphold their word? Do they make themselves accessible to you? Are they helpful with opening paragraphs and skilled in helping the company? Are they supportive of administration? How do they respond in a crisis? Dont presume anything. Their due diligence is going to include a formal background check of you. You should do the same to them. The relationship with the firm may last for years. Make sure you pick a partner you can work with. Starting Point: www.fundingpost.com; www.nvca.org; www.mobiusvc.com
back to top
Page 100
Notes
_____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________ _____________________________________________________________________________
back to top
Page 101
Thanks for taking the time to read the Fast Money Guide. I hope it has helped you discover creative ways to find the capital to launch your new business or to finance that great idea. Cort W. Christie, Founder Nevada Corporate Headquarters, Inc.
NEVADA CORPORATE HEADQUARTERS, INC 101 CONVENTION CENTER DR., 7TH FLOOR LAS VEGAS, NV 89109 1-800-508-1729, WWW.NCHINC.COM
back to top
Three Simple Steps to get Started

Step One Choose Your Business Structure
Corporation Limited Liability Company (LLC)
Step Two Select the Best State
Many people are unaware that each of the fifty states writes its own unique statutes regarding corporate structuring. In 1996, Nevada made its first appearance on the top ten list of states with the highest number of corporations, even though thirtysix states had larger populations. Each month, more than 5,000 corporations are formed in Nevada, with more than 80% of them formed by people who live outside of Nevada. You can live and work anywhere and still incorporate in tax free, lawsuitproof Nevada.
Step Three Find the Best Incorporating Service
Nevada Corporate Headquarters, Inc. (NCH) is the largest incorporating service in the state of Nevada. Since 1989, NCH and its sister companies have formed more than 30,000 corporate entities. When you select NCH as your incorporating service, you are selecting a company unlike any other in the industry. Services include business entity formation, tax consultation and return preparation, advanced business strategy and business credit/funding services thru its partner NCH Capital, Inc.
Remember
Taxes - Nevada has no state corporate taxes, no franchise tax, no tax on corporate
shares and no personal income tax.
Asset Protection - Nevada is one of the few states where the corporate veil (the
legal barrier between your personal assets and your business liabilities) has never been pierced, except in instances of deliberate fraud.
Trust - At NCH, we are so certain Nevada law will provide you, your family and
your business with maximum legal protection that we offer a $100,000 guarantee that the corporate veil of your corporation will never be pierced. Dont Wait Another Day!! Call Nevada Corporate Headquarters, Inc., toll-free at:
1-800-508-1729
WWW.NCHINC.COM
Cort W. Christie is the Entrepreneurs Entrepreneur
Cort is the founder of Nevada Corporate Headquarters, Inc., (NCH) a national business formation and small business services company with offices in Reno and Las Vegas, Nevada. Since 1992 NCH has helped over 30,000 businesses get their start.
Cort is a National Expert on entrepreneurship, business asset protection and small business tax strategies. Additionally, Mr. Christie has an extensive background in business financial services and small business growth strategies. He has distinguished himself as a nationally recognized speaker and has appeared as a featured guest on some of the largest radio shows across the country. Additionally, he has hosted his own weekly radio program in San Diego and Las Vegas and has made guest appearances on MSNBC and CNBC. Cort Christie has a BA in Finance from the University of Minnesota and an MBA from Pepperdine University. He was also the founding President of the Las Vegas Chapter of The Entrepreneurs Organization and currently sits on the Board of Renos Chapter of The Entrepreneurs Organization. Cort is the author of the book Incorporating in Nevada The Do-it-Yourself Guide and the book The Nevada Edge, both of which have been distributed to tens of thousands of business owners internationally. Also, Cort has written various small business guides such as Insiders Guide to Building Corporate Credit and the Fast Money Guide. Cort grew up in Duluth, Minnesota and is currently living in Reno, Nevada with his entrepreneurial wife Jennifer and their children Luke and Lian. Mr. Christies business interests include: Nevada Corporate Headquarters, Inc., a Las Vegas, Nevada-based national business formation and small business services company. www.nchinc.com Corporate Service Center, Inc., a Reno, Nevada-based national business formation and small business services company. www.corporateservicecenter.com Integrated Tax Solutions, Inc., a Las Vegas, Nevada-based Tax and Accounting firm. Contact Information: Phone 775-329-7721, Fax 775-329-0852, Cort@nchinc.com 59 Damonte Ranch Parkway, #B262, Reno, NV 89521

Fast Money Guide

Enviado por

Dados do documento

Direitos autorais

Formatos disponíveis

Compartilhar este documento

Compartilhar ou incorporar documento

Opções de compartilhamento

Você considera este documento útil?

Este conteúdo é inapropriado?

Direitos autorais:

Formatos disponíveis

Fast Money Guide

Enviado por

Direitos autorais:

Formatos disponíveis

Fast Money Guide

To Finance Your Business Your Banker Didnt Tell You About

Fast Money Guide: 79 Fast Cash Strategies for Your Business

2012 Nevada Corporate Headquarters, Inc. All rights reserved.

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

Fast Money Guide: 79 Fast Cash Strategies for Your Business

Cort W. Christie is the Entrepreneurs Entrepreneur

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Fast Money Guide: 79 Fast Cash Strategies for Your Business

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

Fast Money Guide: 79 Fast Cash Strategies for Your Business

TABLE OF CONTENTS (continued)

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Fast Money Guide: 79 Fast Cash Strategies for Your Business

When to consider this option:

Starting Point: www.facteon.com; www.jdfinancial.com; www.inzap.com

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

Fast Money Guide: 79 Fast Cash Strategies for Your Business

Fast Money Guide: 79 Fast Cash Strategies for Your Business

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

Fast Money Guide: 79 Fast Cash Strategies for Your Business

What to keep in mind:

What accredited investors look for:

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Fast Money Guide: 79 Fast Cash Strategies for Your Business

What angel investors look for:

Benefits of angel investors:

Finding Angel Investors

Fast Money Guide: 79 Fast Cash Strategies for Your Business

Things to Keep in Mind:

Things to be Aware of:

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Fast Money Guide: 79 Fast Cash Strategies for Your Business

6. Bank Line of Credit

Why to Consider this Option:

Things to Keep in Mind:

Types of Credit Lines:

Starting Point: www.citibank.com; www.bankofamerica.com; www.irwinunion.com

Fast Money Guide: 79 Fast Cash Strategies for Your Business

Things to be Aware of:

Fast Money Guide: 79 Fast Cash Strategies for Your Business

8. Buy an Existing Business from Cash Flow

Things to Keep in Mind and Questions to Ask:

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

Another NCHINC.com Success Story

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

Fast Money Guide: 79 Fast Cash Strategies for Your Business

9. Brokerage Firm Loans and Lines of Credit

SOURCE: Merrill Lynch Wealth Management

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

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Fast Money Guide: 79 Fast Cash Strategies for Your Business

10. Business Development Commission

Key Benefits Available to You:

Things to be Aware of:

Another NCHINC.com Success Story

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

Fast Money Guide: 79 Fast Cash Strategies for Your Business

11. Business Incubators

Things to be Aware of:

Starting Point: www.nbia.org

Copyright 2012 Nevada Corporate Headquarters, Inc. All rights reserved

Fast Money Guide: 79 Fast Cash Strategies for Your Business

12. Business Plan Writing Contests