There are many venture capital sites on the web claiming to put businesses in touch with investors and or brokers. from sites like Gobignetwork, Go4funding to Raise Capital and one called Find that Money. Well most may be legitimate some are there to just take your money for a subscription that does not give real leads.

Case In point one site in general I am going to pick on called Find That Money I recieve emails all the time from this site claiming that an investor wishes to invest money in my venture upon reading a recent email from a potentially investor I contacted his firm. (below is the actual email that was sent back to me )

Dear Mr. Riley,

Your email regarding the Findthatmoney.com website was forwarded to me. Unfortunately, Findthatmoney.com appears to be sending out fraudulent emails. Mr. Tennenbaum did not write the email that you forwarded and our firm is not interested in investing in your company.

Thank you for bringing this fraud to our attention. I wish you well in your business.

Liz Greenwood

So now you ask who is sending out the bogus emails and why are they committing acts of fraud by signing peoples names to emails they never wrote and sent and what does the law have to say about internet fraud.
good question. I was not shocked that it was bogus cause there are so many internet scams on the web but believe that these people need to be brought to justice for misrepresentation and internet scams so others do not fall into and maybe lose their money.

If you have had a similar experience please share your story.

Happy searching

Tim Riley

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A client prospect answered a question that I ask to gage where they are at in the process of raising money for their business.
Question: “Have you turned down any funding offers in the past six months?”
Answer: “Yes, a private investor offered $500,000 for 50% of the Company and 100% of the online rights giving us a 50% profit royalty. In this case, I felt it was the wrong angel investor with the wrong thought process looking to play on our need for capital, which is not someone I wish to work with long or short term.”
This is from an entrepreneur, who has developed multiple products for a specific niche, that seems to do a better job than the competing products but those products are from much larger well-capitalized competitors. Let’s look closer at the entrepreneur’s situation:

• They formed their company 4 years ago and have generated less than $75,000 in revenue, in total, over that 4-year period.
• Over that time, they have lost/spent to twice that amount.
• They have been looking for capital since they formed the business (without success).
• They still have not penetrated their target market.
• They have serious competition (who has a lot more money and marketing muscle).
• They need capital.

Given the above points to consider, why would they turn down the money?
I understand the emotion that went into their decision. They felt that the investors had an advantage on them and was trying to carve out too fat of a deal for themselves.

Not an uncommon thing with angel investors and venture capital. This created an emotional response. But sometimes, in business, you have to take emotion out of the equation.
As an entrepreneur, creative person, inventor or developer of products there is basic question you need to answer:
Do you want to own a business or do you want to make money?
Most of us will acknowledge that owning, managing and building a business takes time, effort, commitment and money. Very often, a lot of each is spent over a long period. Just being in business does not guarantee you will make a profit or any money from it. Not everyone has the skills to be a successful entrepreneur.
Think about it.
If you are a creative person, inventor or product developer (or a savvy marketing person who can identify a niche and contract out the product development and retain ownership of the product) … are your skills best suited to start, manage and build a company?
Or are they best used to create and develop products?
Here’s another question to answer or consider:
Is it better to have 50% of something with value potential (and $500,000 in your pocket) … or 100% of something that has yet to develop into any value for you (and may not develop without capital)?
In my opinion, if you can create multiple products, putting forth the time, energy and money that goes into the part of the business that does not pertain to creating the products … is a dilution of your best value.
In this case, the investor apparently has the business background and ability to execute and get the product rolled-out and in the marketplace better than it has to date (or why put $500,000 into it). They can do something that the entrepreneur has not been able to do yet. They bring that value (along with the money).
There is more to check out, and specifically there are many ways for the entrepreneurs to protect themselves so that the situation is not a “predatory” one. But a licensing deal like this client prospect passed on would probably be the smart move to accept given their circumstances and that they do have several products developed and have future development capability. By accepting the deal, they can make money without further financial exposure.
This is something I discuss with clients and client prospects to help them prepare for such decisions: Bottom line (and this is a very important thing in business) entrepreneurs and start-up/early-stage business owners with products they have created as the basis for their business, need to think things through when making decisions about bringing in an angel investor and answer the questions:
Do you want to own a business or do you want to make money?
Is it better to have 50% of something (with financial backing to make it valuable to you) or 100% of something that has yet to develop and without capital may not turn into any value for you?
The answer to these two simple questions can dictate the success and financial rewards of your venture.

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As most people know, a large driver behind the current economic
recession was all the residential mortgages that banks were giving out
money to unqualified borrowers.

Once the You-Know-What hit the fan, people began pointing fingers at
mortgages brokers, bankers, lenders…basically anyone who was
originating loans. People were outraged. “They gave me a loan that I
could not afford!” they yelled “Banks are reckless, they knew I was
unqualified and set me up to fail!”.

Well folks, did you know that the Small Business Administation (i.e.
THE GOVERNMENT) offers the equivalent of sub-prime loans to small
businesses? And just like the sub-prime mess, SBA guaranteed loans are
now dropping like flies.

Here’s the worst part. Guess who is suffering due to all this
lending to unqualified business owners? The small business owners
themselves. People who put up cash, their homes, and offered their
personal guarantees are now facing bankruptcy or worse as their
businesses crumble. At a time when banks (ie prudent lenders) were
telling them no, the SBA (ie your government!) was inviting them to
borrower hundreds of thousands of dollars.

The SBA offers to guarantee debt in order to compel lenders to lend
to borrowers that they would not otherwise lend to. In other words, the
SBA promotes lending to unqualified buyers!

(Distressed Loan Advisors offer consulting services to small businesses, and can be reached at www.JasonTees.com)

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I have recently formed a non-profit It Still Takes a Village Inc. that is currently a social club for school aged kids that allows them to take part in community service, no matter their age. I am now looking to start an after-school center that will be located in a stationary location. I would like for it to mirror the after school centers in the bigger cities (i.e. New York, Chicago etc.) The center would be low cost to the parents and provide a safe place for school aged children. Does anyone have any advice for me?

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I am in the process of opening a Retail wine shop and art Gallery in Saint Louis. I have a very good business plan setup and ready to go. I have already raised $75000 in startup capital mostly for construction and opperating expenses now I would like to try to get a line of credit for about $50,000, I was hoping for some advice on approaching a bank about it. My Girlfriend and I are only 23 but we are both very capable. We are both level 2 samalie’s I have a degree in both finance and accounting. I have been starting and running my own business’s since I was 12 so I have a fair amount of capitol if it becomes required. the line of credit is mostly to have additional capitol avalible to take advantage of close out oppertunities on wine that would obviously take more than the standard 30 day terms to pay off.

So if anyone can offer some advice or experiences I would greatly appriciate it.

I hope I am in a good situation because the line would be used to purchase wine which is very liquied in the event of failure they would have a lot of hard assets for a worst case scenario.

Thank You for any help

Alex

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Enjoy small business tax advantages using the latest small business tax deductions to reduce what you’ll pay

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I am a residental real estate developer, and have two projects at different stages currently in progress. I have owned the properties for roughtly 5 years, and have recently been offered a tremendous pay off discount from my bank. They are discounting my loan balances to below the liquidation values on the properties.

The bank has been hit hard by these types of commercial loans and are aggressively trying to clean up their balance sheet, thus the reason for this opportunity.

I have begun to look into the private equity, joint venture, and alternative financing market, however; this is the first time I have had to look in this direction, as my financing has gone through my bank for the last 10 years.

If anybody that knows a good network or source to reach reputable alternative funding sources, I would appreciate your feedback.

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Making the decision to close your business is not easy, but often
times, it is absolutely the correct thing to do. Once you make the
decision to close your business, the next inevitable question is: Now
what?

If you are closing your business, you should establish a plan. That
plan usually means working with your bank. Presumably, the SBA loan
you have is secured with the assets of your business. That can include
tables, chairs, ovens, sinks, etc. Before they will entertain talk of
settling your debt, your bank will first want to liquidate all the
collateral (the one exception could be your primary residence). You
need to contact your bank, explain to them that you have closed, and
you are willing to cooperate however you can. This will usually entail
the bank valuing the assets, and if they have value, they will sell
them and apply the funds to your loan balance.

Once the business is closed, and all the business assets have been
liquidated, you will then be eligible to submit an Offer In Compromise
(OIC) to the SBA. This is typically accomplished by submitting the OIC
through your lender. Your lender will review the OIC, then forward it
on to the SBA (Note: the SBA will want to know if you’ve been
cooperative, so play nice with your bank). It’s important to keep in
mind that if your home is being held as collateral, your OIC offer will
need to at least cover the amount of equity in your home. If you don’t
offer at least that, the SBA is likely to reject your offer.

If your offer is strong enough and the SBA approves it, once you pay
whay you agreed to pay to settle the debt, the SBA will release your
personal guaranty and any remaining liens on your home. Keep in mind
that if you are paying over time, these releases will only come once
you’ve paid the entire amount of the OIC.

(Distressed Loan Advisors offers consulting services to small business owners, and can be reached at www.JasonTees.com)

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By : Pamela Williams – When establishing a separate credit history for your business, does your personal credit matter? Does it make a difference whether or not you have good personal credit? As a business owner, why should you be concerned about your personal credit score?

Your Personal Credit and Your Business

As a new entrepreneur, you may need to apply for a loan in order to finance your business. Without business credit, lenders would be looking at your personal credit history instead to determine whether to approve or decline your application. Thus, having an excellent personal credit or a high FICO score would surely win you an easy approval from your preferred lender. Consequently, if you have a low FICO score or a questionable credit, you may find it more difficult to get approved for a loan.

On the other hand, you may also be able to obtain the loan you need by applying for a bad credit business loan. Lenders who offer poor credit business loans always approve clients regardless of the status of their credit. However, these loans are expectedly more expensive than loans that require good credit.

Clearly, the status of your personal credit score makes a difference in getting the financing you need for your business. But what happens after your loan has been approved? What’s the next step in building your business credit? Why should you establish a separate credit history for your business?

Establishing Your Business Credit

As soon as your loan has been granted, you should take the necessary steps to establish a separate credit for your business. Make sure that you’ve obtained all the necessary permit, licences, tax id numbers, and registration numbers that are required for businesses. Afterwards, register your business with a business credit reporting agency like Dun & Bradstreet or Experian Business.

Remember to submit your monthly loan payments on time to build good credit. At the start, any delays or misses on your payments will also reflect on your personal credit report. Why is this? Since your personal credit history was used on opening up the loan, your credit report acts like a co-signer for your business. Therefore, it is crucial to keep up with your payments not only to build a good business credit but to protect your personal credit as well.

After some time of consistent payments, you should have already established your corporate credit. You may need to wait a year or more before you can completely separate your business credit report from your personal credit report.

New businesses are just like a teenager who’s just starting to build a credit history for himself. At first, a student may need a co-signer to get a loan but once approved, a student can slowly build his own credit history and after a while, he can easily apply for new credit without relying on other people’s credit. Clearly, if you plan to venture in business, preparing your personal credit is a must. Although a good personal credit history isn’t necessary required to start a business, it is definitely an advantage.

Author Resource:- Pamela Williams is a Loan Consultant, Internet Marketer, Writer and owner of BusinessCreditCardSite.com, a finance company in Las Vegas, Nevada that provides support for businesses all across the US particularly with obtaining business credit cards. Visit http://www.businesscreditcardsite.com

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