Capital Feed

Shortly after launching ROC Brewery in February 2010, we needed to start raising some capital. But when we approached angel investors and banks, we quickly discovered how hard it is to raise capital in today’s shaky economy.

What’s worse, a microbrewery in the heart of downtownRochesterisn’t exactly an easy sell when it comes to securing a loan. Many microbreweries go under within the first few years so not too many investors are eager to jump on board. Then we found out about Samuel Adams Brewing the American Dream.

Interesting and inspiring.  Innovative in business then use that innovation to find capital. Keep on reading at CNN Money.

Last week, the U.S. House of Representatives passed the JOBS Act, a bipartisan bill aimed at supporting small businesses by making it easier for them to access capital. A key feature of the bill enables crowdfunding, the process by which small companies raise growth capital from a large number of individual investors.

While many people are debating the impact of the bill on investors, what seems lost in the debate is what types of businesses are likely to benefit, and how crowdfunding can change the way we all think about early stage investing.

 Slowly we get closer to what should be. Keep on reading at TechCrunch.

One of the most important keys to securing a business loan is the amount that you ask for. Ask for too much and your loan request will be declined. Ask for too little and you might have to go back for more or see your business suffer.

Going back to your lender for more money because you did not get enough in the beginning can be a red flag. And, if the bank or lender does not provide more capital, your business could close; leaving you with the original loan and no means to repay it.

So, how much money does your business really need to get off the ground and grow?

All businesses are different and thus all have different capital requirements. There are businesses that are capital intensive (meaning needing a lot of equipment) like manufacturers or dry cleaners or retail businesses that rely on inventory. Some businesses are people intensive like accounting firms or collection agencies. Thus, they have different capital needs.

However, all businesses can follow a few simple rules when it comes to their capital needs.

To find out more about these few simple rules you can go to Business Money Today.

Many entrepreneurs plan for years before finally starting a small business. The planning years are often full of dreams of being the boss and the belief that hard work and a good idea is all that is required for success. Many of those same entrepreneurs find that they were harboring some common myths about owning a business. Encounters with reality can send new business owners back to the drawing board after much wasted effort. Indentifying the myths before you get started planning and launching your business can prepare you to make sound decisions based on facts.

 Government Grants and Loans

One of the most common myths is that there is a lot of money available to small business owners in the form of government grants and loans. The federal government does not make loans to businesses. State and local offices of the U.S. Small Business Administration, or SBA, operate loan programs in partnership with various lenders, but the SBA does not make loans or provide grants to small businesses. Some state or local government agencies provide grants to targeted groups, such as minorities or the disabled, nonprofit organizations, educational businesses and tourism or others businesses that benefit the community.

More Free Time

Being a successful business owner requires accepting that managing your business is a lifestyle and not a 9-to-5 job, according to small business owner Patricia Simone, writing online for Entrepreneur. The myth is that owning your own business means you will have more free time and have more control over your time. The fact is that long after everyone has gone home, small business owners are finishing up tasks, packing up work to take home and putting out fires only they can handle. According to Simone, small business owners report having less free time and juggling more demands on the little time available.

 To read more go to the Houston Chronicle.

No, this is not a loan to cover the cost of your coffee.

Starbucks is seeding a new business loan fund with $5 million.  Starbuck’s customers can also donate to the program.

Starbucks, through this new business loan program called “Create Jobs For USA”, in conjunction with the Opportunity Finance Network® (OFN);

“will provide loans to underserved community businesses.”

In fact, Starbucks thinks that for every $5 in donations, the fund will leverage some 700% or $35 of financial support to these businesses.

According to CEO Howard Schultz, “We’ve got to thaw the channels of credit so that community businesses can start hiring again.”

To read more about how to help your local community grow new businesses go to My Take On…

There’s no substitute for homework.

 That’s where the real learning happens for students, and the same is true when investigating a franchise. The most important homework step is calling people, specifically the franchisees of the system you’re interested in. You’ll receive a list of all the existing franchisees in the Franchise Disclosure Document you get from the company, so take the time to call at least five to 10 of them. It also a good idea to do a search online to find some former franchisees.

 Here are the best questions to ask them:

 To read more of this article check out Entrepreneur

Great grant programs for small business that can provide specific research and products that the Federal government wants and needs.

 Also, know that if there is not a specific grants listed for what your company wants to research or commercialize, you can always send, to the appropriate department, a white paper explaining your goals and see if that department will put that grant request out in their next budget.

 These grants are for existing businesses looking to further develop their current technologies (e.g. expand into new markets) or expand their product offers as well as start-up businesses who meet the grant’s criteria.

Read the Los Angels Times  article here.

We hear about grants all the time, on TV, on the Web and in our email.  But, if you have ever looked into those so-called grant opportunities, you find out that most just want to sell you something (like a grant list) that does not fit your situation (business) or never will work for you.

In researching real, true business grant opportunities, I came across this business grant listings that actually has gone out and found true business grants.

This list outlines several grants that are only for for-profit businesses.  The lists provides who is providing the grant, the name of the grant program, some basic information about the grant like the grant amount, the criteria and its deadline and a link to where your business can apply.

Further, this list is updated weekly – removing those that have expired and adding new ones that they find.

There is no cost or fees to access this list – which is refreshing. 

To see this listing of true for-profit business grants:

Can a new, start business really raise the funds it needs to get its operations off the ground?  Yes and no.  Yes, for those companies that can start on a shoe string budget – like online businesses.  No,  for businesses that are labor or capital intensive.

Find out more: Does Crowdfunding Work for Early Stage Growth Companies?

Original Post: VC Deal Lawyer

But, that does not mean you cannot get financing.  You might just have to look in other places.

Know that many of the most successful businesses we have today in this country – started out this same way.  I lost count of how many billionaires there are who took small loans from their mothers to get started (think Ross Perot or Mark Cuban).

Learn how you to can finance your start-up company and begin to move forward with your business dreams:

How To Really Finance A Start-Up Business – 3 Simple Ways