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A project consumes resources, whatever their stage of development. Investment in production investments equipment, tools ), business investment sales network, packaging, advertising and funding needs working capital inventories, trade credits have to find capital to ensure the sustainability of the carmel advisors project.
The innovative firm must therefore assess how each step in the process will be funded. The development of innovation increases, for example, the need for working capital. Funding can be obtained from various sources capital, business angels, flow. But each source has its own selection criteria and carmel advisors business prime target.
Must be identified as soon as possible the partner suited to the innovation stage. Indeed, external funding is to seek long before having employment : in the feasibility phase, it must negotiate with investors including projected development needs, but also the launch because negotiations are long and should not be made to the wall.
In addition, funding must be able to bind to avoid disruption would jeopardize the future of the carmel advisors project significantly.
But the search for capital is all the more difficult it is upstream of the project, due to poor visibility. Funding must then show even more patients and less risk averse. As illustrated in the following diagram, state aid often prove valuable upstream phases.
The choice of project funding is crucial and must ensure your business autonomy, solvency and profitability. Good financial management respects the carmel advisors financial balances based on the holding period of the property and the type of associated funding :
stable resources (equity and debt in the medium term) fund stable jobs (tangible, intangible and financial assets ). For example, a company can finance the purchase of a machine tool with a long-term loan ;
the short-term needs are financed by short-term resources. For example, the need for working capital may be financed by a bank overdraft.
Given their high risks, with the feasibility and carmel advisors llc development of a program of innovation has traditionally financed by increasing capital or by using the cash flow of the company. The primary source of financing can obviously be supplemented by state aid.
Personal contributions and cash flow
This personal contribution is essential to inspire confidence in others, especially when applying for credit. It allows self-finance some not taken into account by the banks long-term needs : expenses, intangible assets and working capital. The personal contribution can be in capital and / or in the form of current accounts. In this case, your funders ask you, in most cases, to block the current account in the medium term. In putting together your personal contribution, do not forget to leverage your carmel advisors company savings booklets : certainly, you must do it in advance, but they can often get attractive loans.
To complete your capital contribution, you can also get personal loans from either your bank or specific associations France Initiative Network, Adie. .. ). These loans typically have a personal guarantee of the creator mortgage on property, equipment trust. ...
The primary source of funding is obviously the flow generated by the operation of the existing carmel advisors business cycle. This cash flow is a key element analysis of an application for funding.
Who are the Business Angels ?
A Business Angel is an individual who invests a portion of its assets in an innovative business potential and, in addition to money, available free of charge to the contractor, his skills, experience, personal networks and some of his time. In France, carmel advisors Business Angels are now over 4000 and are grouped into local networks.
How a Business Angel investing in a project ?
The range of investments made by business angels is usually between 10,000 and 250,000 euros. Business Angels are often more to invest in a project, which allows them to share the risks of investing in several projects at once, or again, to fund the creation of a larger project.
At what stage of maturity of a project Business Angels invest in?
Business Angels are likely to be involved at all stages of the business life : the idea of financing development finance or a business recovery. However, the majority of business angels investing in the creation stage. This is where they are most expected by the promoters and they are most useful to them.
How the funding from Business Angels differs there other sources of funding?
Conventional investment companies, involved very little start-up phase, is mainly interested in highly innovative technology companies that have already achieved a certain level of development. Business angels usually do not have sectoral criterion that matters most is the potential of the company and the personality of carmel advisors entrepreneurs who come to them. It is their own heritage is at stake, so they have more flexibility in their analysis and decision making.
How to contact them ?
France Angels, National Association for the promotion of investment by Business Angels, the French federation of Business Angels networks. To contact networks, see Directory of networks on its website
Private equity investment
The capital is a means of financing the start-up, development or acquisition of a company in which the investor will get a fixed share capital of the company in exchange for the money they bring. This funding may take different forms : the issue of shares, convertible bonds CBs) or redeemable in shares ORA ), warrants to subscribe for shares (BSA). Investors are remunerated by dividends but also the gain realized upon the sale of securities held shares) : trade sale, IPO. The investor takes the risk of business failure like any other shareholder.
In general, funds development capital are involved in capital of a limited company (SA) or joint stock company (SAS).
2. Type of capital
The capital investment includes all the actors involved in the equity business.
Several categories of investors divided according to the stage of development of the company can be distinguished:
funding seed capital (seed capital they occur very early, sometimes at the moment of creation, when the company starts developing its technology. These funds are generally semi -public, but there are still some private funds ;
the capital venture they traditionally occur when the company completed the development of its products and begin recording its first orders. The money is invested primarily in marketing development and implementation of a carmel advisors sales force. Among venture capital funds, there may be mentioned the FCIC Mutual Fund in innovation ). The FCIC collect their funds from private investors (who then receive a tax benefit on their tax then must invest 60% of the assets in innovative enterprises;
funds development capital (or capital letter) : these funds operate in fairly mature companies that generate a significant turnover and profits, and who want to increase their market share by increasing their production capacity and / or developing internationally.
In the case of a buyout, other investment funds may intervene : this is called fund LBO Leveraged Buy Out). LBO technique allows the acquisition of a company with leverage involving bank debt and equity contributions through a holding company created for the occasion. These funds are intended for very mature company, positioned in markets growing steadily and with good financial visibility (high profitability).