In deciding how much of an equity stake to offer Job Function Email List an investor one must consider the issues surrounding control of the business Job Function Email List. In addition to voting rights the percentage share held can also have tax implications. Although flexibility in Job Function Email List negotiations is important it is vital that you know the percentage of shares you are willing to relinquish. On reviewing your business plan the investor Job Function Email List will also have a minimum amount of voting rights in mind. Debt It is again possible to have your own or external debt to finance the business. Your ability to raise external debt will largely depend on Job Function Email List the investor's perception of your company's ability to repay that debt.
The cost of the borrowings will be linked to the perceived level of risk, the length of time and the rates offered by other investment opportunities Job Function Email List in the market at that point in time. Banks in particular have ratios to assess the repayment capacity of the business based on cash flow and profitability. Grants Depending on the country you operate there may be Job Function Email List government agencies that offer grants. The best agency and individual scheme depends largely upon the size of the business, its stage of development Job Function Email List and the sector in which it operates. As a general rule local agencies cater Job Function Email List for businesses with 1 to 10 employees.
They may offer feasibility, employment and capital grants Job Function Email List. National agencies tend to cater for larger businesses and those that have the potential to export products Job Function Email List or services. Specialist government agencies may assist businesses based in certain rural areas. These agencies may take an equity Job Function Email List or debt stake under certain circumstances. Summary The financial section of the plan needs to illustrate the amount of money required to establish and run the business. Potential investors need to know the money already being committed by various parties.