Tuesday, August 18, 2009

Business Funding Network Helps Entrepreneurs Raise Money

Funding Universe is just one of the latest methods many entrepreneurs are using to help raise money for their business during these tough economic times.

Business credit services and business lines of credit which traditionally assisted prospective entrepreneurs with their financing needs for start-up – seed money; or existing small businesses in need of infusion capital for strategic growth continues to be difficult to access in today’s financial market.

Where Are Small Business Entrepreneurs Turning To Raise Money For Business?
Lack of accessible business financing from banks seems to have given rise to more Funding Networks cropping up to fill this gap and entrepreneurs, small and medium sized businesses appear to be lining up to tap into this funding source.

Funding Networks are comprised of private, high net-worth individual investors who generally invest anywhere from $50,000 to $2 million in various sized businesses.
In the past, these investors (often referred to as Angel or Venture Capital “VC” investors) primarily infused their funds into existing companies, seeking to raise money who had products and services currently in the marketplace.

Recently, some Funding Networks are encouraging and steering more start-up businesses to seek money raising through Angel and Venture Capital avenues. Gauging whether this direction is being taken due to increased investor philanthropic interest is yet to be determined.

However what is known is many, if not most of the private investors found in Funding Network databases were formerly entrepreneurs themselves who had groundbreaking business ideas coupled with sound business management strategies and solid business plans. These investors are in the position to not only offer financing options but also valuable business expertise.

Adding to philanthropic interest for making more funds available through angel and venture capital investors is understanding the need to stimulate the economy by pumping money into the business marketplace. One of the fastest ways to fulfill that need is by supporting and facilitating small businesses with the capability to start buying more products and services from one another.

What Makes Funding Networks Appealing To Business Entrepreneurs?
While Angel and VC business financing is being more apparently advocated, make no mistake about it – this is not guaranteed financing and it is not easy to come by. Some industry experts even say it is easier to hit the mega-million lottery than to get funds from these sources.
Yet with that said, this same funding source is being made available to business entrepreneurs. Groups of private investors meet regularly to hear brief presentations, referred to as “speed pitches” from entrepreneurs seeking money and then, often, give money jointly to companies.

Herein lies the problem of why more businesses are not raising money utilizing Angel and Venture Capital funding sources-- most business entrepreneurs are ill-equipped on their own to meet the rigorous standards and degree of excellence required to tap into and receive the funds. Also, lack of knowledge of where to find these private investors presents a problem as well.

How To Find Angel and Venture Investors? Through Funding Networks and Angel Clubs...

One that is gaining high popularity is Funding Universe

Angel InvestorsAccording to their website, 98% of entrepreneurs fail to find funding and Angel Investors only fund 14% of the businesses they investigate.
—Center for Venture Research

3 Reasons Getting Funding Is Difficult For Most Entrepreners
1)Seek the wrong type of capital
2)Don't meet the specific requirements for that capital
3)have an inferior business plan, pro-forma financial statements, pitch, and investor contacts

Funding Network is appealing to entrepreneurs because they are designed to help entrepreneursunderstand the world of investing and how to best finance their ventures.

FundingUniverse connects qualified entrepreneurs with active VC's, angel investors and lending sources. In addition, FundingUniverse provides services to help entrepreneurs prepare for investment, such as helping them create compelling business plans and pitches, advising them on strategic business direction, and preparing them for investor scrutiny.

Entrepreneurs are introduced into a network of active investors who rely on FundingUniverse to bring them qualified investment opportunities. FundingUniverse enables investors to view and listen from the comfort of their home as qualified entrepreneurs pitch their ideas in written, video, and live formats. Funding Universe also provides live SpeedPitching events where entrepreneurs pitch investors in a fast-paced, high-energy format. These events provide the perfect opportunity to cultivate business opportunities between multiple investors and entrepreneurs.

While Angel and VC investor financing can be difficult to obtain - it is definitely worth the effort in raising money for businesses when you can take advantage of the resources ogffered by networks like Funding Universe.

Learn How Funding Universe Can Help Business Raise Money Here