Business Funding Blog

Buying vs Leasing IT – An Investor’s Perspective

When a fellow investor was apparently unhappy with the answer of the entrepreneur pitching his company’s funding need, I found myself asking my compadre for clarification to his previous question (something the small business owner probably should have done, when all is said and done). “We have been fortunate enough to be able to purchase all of our technology; and therefore, have not needed to lease any of our hardware or software…” was the response from the CEO of a small manufacturing firm seeking $1.5M to expand his clientbase in the defense industry.

Buying an Existing Business? Here’s how you can finance the deal.

We’ve found that…

Getting funding to buy an existing business is hard. Lenders will put the prospective buyer and the target company through a rigorous examination. They’ll look closely at everything for any potential risks – the buyer’s track record, his or her future plans for the target, and the target’s recent performance. A new owner will always find it harder to borrow than the seller did, even though the business may have a strong track record. As small business financing remains tight, financing business acquisitions is particularly tough.

EquityNet will work with you to overcome the financing obstacles to buying an existing business.

Tyga Technologies is cutting waste by revolutionizing the way items are tracked

How Tyga Tech works (video)

“We founded our company, TygaBox Systems, Inc., in 1991 out of our caring for the environment.  Our main product, the TygaBox System, is a reusable plastic box & dolly system used in office moving throughout the USA.  Replacing corrugated boxes, it reduces the cost of moving by 30% and entirely eliminates waste-to-landfill. The 30% cost reduction is due to Tyga-Boxes stacking 5 high vs. cardboard only 3 high, resulting in fewer stacks, elevator trips and truckloads required to do a move job.

Manufacturer Working Capital Financing

Improving working capital is a common goal of most manufacturers. This becomes particularly important when a business is looking to raise capital from investors or undertake strategic growth initiatives, whether it be upgrades to equipment, purchases of new equipment, facility expansion, transportation of materials, or research and development. Here are some ways access more working capital to grow your manufacturing business.

Need a Small Business Loan? Here’s What You Need to Know

small-business-loans

Einstein: SBA = 7(a) + CDC/504.

Henry Ford once said, “Any customer can have a car painted any color that he wants so long as it is black.”


As many small and medium size business owners know, Ford’s quote doesn’t apply to the options that seem available when looking for a loan. The list can overwhelm: Interested in an SBA loan? In that case, which is it: 7(a), CDC/504, or microloan? How about an BLOC? If not commercial-bank ready, maybe you could use an ACH loan or PO funding? If the choices are starting to look like an incoherent word scramble or a computed-generated password, don’t despair: In this brief article, I’ll help you decipher the the basics of the loan landscape. Alternatively, you can scroll to the bottom, contact me, and I’ll work through it all with you.

Financing Working Capital for Small Businesses

financing-working-capital-small-businesses

Financing working capital is a common hurdle that small business owners have to overcome. Whether you’re a manufacturing, service, transportation, or tech company, it is vital to have working capital on hand when you’re looking to upgrade equipment, purchase new equipment, expand your facilities, transport materials, or invest in research and development.

Best Practices to Improve Working Capital:

Track payment behaviors of your customers

Be sure to set up an automated tracking mechanism to flag you for consistently bad customer behavior. Customers that regularly pay late, don’t pay, or are generally difficult to deal with can take a large toll on your business. In other words, it’s ok to fire your customers. Refocus your attention on existing customers and new customer acquisition.

Funding for Self Storage Businesses

Funding-self-storage-businesses

The market for self storage facilities is booming. Even though the average size of new homes is around 2,500 square feet, up 15% over the past 20 years, 10% of the country rents self storage units. Why? Because families are out of space, an increasing number of adult children are moving back home, and a credit crunch is limiting families’ mobility to bigger houses. None of these trends show signs of slowing down.

 

This translates into a $30B industry that is growing at 3% a year, with unit occupancy steady at 90% even as rents are rising 3% a year.

LED Manufacturer Finds Funding on EquityNet

One of the most challenging aspects of running a small business is getting access to the capital you need to grow. Bootstrapping and investment from friends and family can only carry your company so far, and sourcing capital from outside investors can be time consuming and difficult.

LED lighting companies have faced unique headwinds in acquiring financing. Although initial investment in LEDs can carry a high price tag, the savings compared to older high intensity discharge (HID) lighting pays off quickly – cutting energy costs and drastically reducing bulb replacement costs. Though the costs of LED fixtures are dropping quickly, retrofitting an entire business space with new LED lighting can still be too large a sum for many customers to afford. Therefore, LED light manufacturers have adapted by providing financing for their customer’s purchases – directly or through a third party.

Business Partnership Buyout

Partnership buyouts are common for small businesses. Often the equity partners are no longer aligned or one of the business partners is looking to retire. These business buyouts can cause disagreements if not handled thoughtfully. Here are some tips for the successful financing of a partnership buyout.

Business Valuation

One of the most important details to settle on for a smooth partner buyout is the valuation of the business. We’ve developed this guide to help you understand the particulars of small business valuation. Alternatively, many firms ask a 3rd party valuation firm to run an analysis for them – but this is a bit more pricey – often costing thousands of dollars.

Business Line of Credit Reduced? Here’s What to do Next

Many businesses have seen their line of credit (LOC) cut since the recession, because banks have unilaterally scaled back risk and restructured asset allocations to meet new federal compliance standards. In many instances, a credit crunch can reduce your line of credit by more than 50%, even if you have great credit and your business is strong. In other cases, companies are forced to close their accounts altogether and the bank will offer a term loan to pay off the remaining balance within 1-3 years.