“Start-Ups Are Pummeled in the ‘Great Unwinding’ - The New York Times” plus 2 more

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“Start-Ups Are Pummeled in the ‘Great Unwinding’ - The New York Times” plus 2 moreStart-Ups Are Pummeled in the ‘Great Unwinding’ - The New York TimesThis New York City Pharma Startup Wants To Turn LSD Into An FDA-Approved Medicine For Anxiety Disorder - ForbesApplications Are Open for Grow-NY's Food and Agtech Startup Competition - The SpoonStart-Ups Are Pummeled in the ‘Great Unwinding’ - The New York TimesPosted: 01 Apr 2020 11:45 AM PDT SAN FRANCISCO — After a crush of travel cancellations in March, WanderJaunt, a short-term home rental start-up in San Francisco, laid off 56 of its 240 employees last week.Demand for services from Wonderschool, a start-up that helps people find day care and preschool providers, dropped by half, leading it to cut most of its 60-person staff.And at ClassPass, which offers a membership program for fitness classes, over 95 percent of revenue evaporated in just 10 days as studios and gyms around the world shut down. To survive, the start-up slas…

“6 Tips To Secure Funding For Your Business Investment - NuWire Investor” plus 1 more

“6 Tips To Secure Funding For Your Business Investment - NuWire Investor” plus 1 more


6 Tips To Secure Funding For Your Business Investment - NuWire Investor

Posted: 01 Feb 2020 09:36 AM PST

Do you want to establish your own business but don't know how to because you lack funding? Luckily, there are numerous ways on how you can secure funding for your business investment.

Regardless of your target niche, it's possible to start your own business. However, securing funding for your business is not as easy as you think. In fact, in the 2013 Ernst & Young study, the primary reason for businesses closing their doors is due to lack of funding.

Looking for funding can be challenging, but there are some tips on how you can secure your funding effectively. These include the following:

  1. Raise Funds as Early as Possible

There are some entrepreneurs who resist raising capital for the reason that they don't like third party shareholders. However, what entrepreneurs should know is that it takes years to reach profitability, so it's crucial to have a plan on financing losses during startup stages to share the rewards and risks.

Plus, it's always a good idea to have a backup plan for your funding. Considering financial services can also make a difference. If you don't know which financial services to go to, there are numerous reviews online, such as the fund and grow review, to help you out.

  1. Consider Taking Loans

With today's credit crisis, many banks take chances with their money and Small Business Administration guarantees loans, which became a hot commodity. However, before you take out any loans, you must ask experts about an explanation of business credit for you to stay on the right track and avoid any possible big financial problems in the long run.

Also, while there are loans backed by SBA for small businesses, there are some qualifications you must keep in mind. One of these is that your company must meet the definition of the government of small businesses for your industry. If your business is qualified, you have to apply for a commercial loan from any financial firms that process SBA loans, since SBA doesn't give loans directly.

  1. Secure Funding Through Crowdfunding

One of the ways to secure funding for your business is through crowdfunding, which is an effective and fun way to raise money for creative and low-cost projects. In fact, crowdfunding fills the gap in private finance.

The only thing you should do is to set the amount of money you want to raise for a certain timeframe. Your family, friends, and other people you know may share about your page to pledge money.

Typically, people who use crowdfunding websites offer incentives for pledging. For instance, if someone pledges a certain amount of money, you'll have to give them something in return. Depending on your business idea, the options are yours to decide when it comes to incentives.

  1. Don't Forget to Nurture Your Network

The key to being introduced and get in front of the perfect people for your business is having a great professional network. It'll not just help you fund your small business, but it can also be beneficial in growing your business.

Keep in touch with your previous co-workers and never miss local conferences and meetup events. This will help you meet more people in your network that'll introduce you to loan managers or potential investors.

The only thing you should remember when networking is to concentrate on knowing the person as a whole, not just on how and what they can provide you. It's not wise to just take advantage of people around you. As you establish your network, you should listen and be a resource to everybody you meet.

  1. Determine Your Audience and Make Sure to Tailor Your Pitch Accordingly

If you want to gain investment, you should have strong pitching skills. You should tailor your messages to every investor. Investors have to see a concise and clear plan for your business's future direction. They also need to know how their investment will help your business and when they can see an ROI (return on investment).

To get the best results, make sure that you know your audience and always practice your pitching skills.

  1. Approach Experienced Investors

When it comes to approaching experienced investors, you must do thorough background research. You must approach those who have the best track record in terms of helping businesses similar to yours.

Some investors may offer you more than just the capital you need. More often than not, they offer experience and knowledge that can be valuable to you and your business in the future.

Conclusion

Getting the funding you need for your business investment is not a small task. It's stressful to secure the money you need for launching your business. There are also times that the process may seem impossible.

Fortunately, there are various options you can consider to secure your business funding. Just follow the tips mentioned above and secure your funding successfully.

Author Bio

As a business consultant, Ethel Rusconi works with new and small business owners to help them set up their business finances. Ethel would assess her client's finances and create a financial plan that enables her clients to fund their business. Ethel also provides advice on the best investments her clients should make. During her leisure time, Ethel writes articles on business and publishes them online.

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[Budget 2020] Seed Funds, ESOP Tax Deferral By 5 Years Announced For Start-ups - Entrepreneur

Posted: 01 Feb 2020 05:04 AM PST

Finance minister Nirmala Sitharaman said start-ups "have emerged as engines of growth for our economy" and announced some key policies benefiting the community

4 min read

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

The government has proposed to provide seed funding to early-stage start-ups and deferred tax payment on the Employee Stock Option Plan (ESOP) by five years or till the time the employee leaves the company or when s/he sells the shares, whichever is earliest. 

Finance minister Nirmala Sitharaman said that the proposed seed funds for start-ups will promote ideation and development of new ideas in the Indian start-up ecosystem. 

Speaking about the proposed deferral in ESOP tax payment, she said, "ESOP is a significant component of compensation for these (startups) employees. Currently, ESOPs are taxable as perquisites at the time of exercise. This leads to cash-flow problems for the employees who do not sell the shares immediately and continue to hold the same for the long term."

Also Read: [Budget 2020] LIC To Go Public To Pay For Govt's Disinvestment Target Of INR 2.11 Trillion For FY21

Push towards digitization

The turnover threshold for auditing is raised from INR 1 crore to INR 5 crore for Micro, Small and Medium Enterprises (MSMEs) who carry less than 5 per cent of their business transactions in cash.

Sitharaman also proposed an app-based invoice financing loans product for the MSMEs to reduce the problem of delayed payments and consequential cash flow mismatches.

Promoting Entrepreneurship Spirit

Sitharaman said that entrepreneurship has always been the strength of India and announced schemes directed to promote it further. She proposed to set up an Investment Clearance Cell for entrepreneurs. The cell will act as an end-to-end investment guide for entrepreneurs.

"I propose to set up an investment clearance cell that will provide end-to-end facilitation and support including pre-investment advisory, information related to land banks and facilitate clearances at Centre and also at the state level," said the Finance Minister.

A scheme to provide subordinate debt for entrepreneurs of MSMEs was also proposed by Sitharaman. "This subordinate debt to be provided by banks would count as quasi-equity and would be fully guaranteed through the Credit Guarantee Trust for Medium and Small Entrepreneurs (CGTMSE). The corpus of the CGTMSE would accordingly be augmented by the government," she said.

The window for the restructuring of debt permitted by RBI is also extended till March 31, 2021.

Also Read: [Budget 2020] 3-themed Budget Seeks To Address High Unemployment, Low Demand and Falling Economy

Tax Benefits for the start-ups

The finance minister has proposed that a start-up which has turnover up to INR 25 crore can avail deduction of 100 per cent of its profits for three consecutive assessment years out of seven, if the total turnover does not exceed INR 25 crore. The period of eligibility for claim of deduction is also proposed to increase from the existing 7 years to 10 years

An increase in the turnover limit from the present INR 25 crore to INR 100 crore was proposed by Sitharaman to benefit larger start-ups.

Also Read: [Budget 2020] Railways Remains Under Stress With High Operating Ratio

Reactions from the start-up community

The start-up community has welcomed the proposed measures with open arms. "Raising the turnover threshold for audit for businesses to INR 5 crore is a welcome relief. Hopefully, tax filing for such businesses will also be simplified. However, such businesses will have to be careful with keeping cash transactions under 5 per cent and will need a technology-based mechanism to track that," said Archit Gupta, Founder and CEO, Cleartax.

"A lot of start-ups are expected to benefit in terms of early stage advice and direction with the investment clearance cell that has been proposed in the budget. Nurturing and supporting the startups in their initial stage is imperative to strengthen the foundation of the entire ecosystem," said Jeetender Sharma- Founder and MD, Okinawa Autotech Pvt. Ltd.

Saurabh Srivastava, chairman, Indian Angel Network, said, "The measures announced on ESOPs, taxation and seed fund will infuse tremendous energy in the ecosystem. The clear message on no-undue harassment will provide renewed confidence to entrepreneurs to create new innovative startups which create jobs and wealth in India and strive to take over the world."

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