Register now or log in to join your professional community.
Identifying the sources of finance for start ups is not an easy task. However considering the fact how much certain you are that your business will be a success eventually will give you a hint on how much risky you can be. The rule is simple high risk high return but don't push so hard.
There are many example where a business was just started with credit and loans and with time it turned in to multimillionaire business. If your idea is new and yet to be tested its better to get along some partners to invest in the business as risk will be divided among st you and the level of investment you need will be lessened so as the profit will be divided as well.
However, its always a good idea to have some level of your many as an investment in addition to getting debt finance like loan, credit terms.... etc.... you need to figure out what debt:equity ratio will suit your business type which require certain and specific figures.
Hope my answer was of any help...
The growth stage or prove the validity of ideas and visions on which the company in the establishment phase. The company must begin to work on achieving greater revenues and profits by expanding its customer base and range of services / products offered. And is usually measured with this growth, according to a number of criteria such as the number of employees of the company and the existing departments of the company and changes in the institutional culture of the company, and the extent of the application of the foundations of management and operation. It is the elements of success at this stage to obtain financing to achieve greater growth in the company's activity, and the evolution of the elements of management and decision-making in the company. It attributes this stage that the project owners and founders are hiring managers specialists in various administrative areas such as marketing, sales and production, while the project owners of strategic management of the company and orientations of growth cares more intervention in the labor management and details of everyday as is usually the case in the establishment phase. The company is at this stage more attractive for both types of direct investment funds or individual investors due to the fact that the company's growth on the ascending curve at this stage. It is expected to achieve the results of the high-profit, provided that the industry in which it operates in the growth phase also be, and the performance of the company at this stage, also better than the performance of its competitors, it is expected that the company will continue to increase market share and be all these elements attractive to investors in capital .
The borrowing institutions or banks will be selective in the companies that pass this stage financing, as it will depend on the risks involved in your organization and the risks involved in the industry in which it operates evaluation. And also take into account those institutions is an important element, namely the sector in which they operate as a whole, and whether the concerned and interested in investing in it. Banks as well as the assessment of the facilities required by company type. One advantage of this stage, there is no record of success for the company in addition to a number of fixed assets that can be offered as collateral for lending institutions, which can contribute to obtain financing lending is easier than the establishment phase. There is also another alternative for funding at this stage, an increase of share capital from the current owners or a capital increase by foreign financial institutions to invest in working capital or strategic investors. In all cases, financial institutions will be keen to assess the growth potential of the company's future and its value prior to a contract agreement with existing partners.