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Business Funding

Sources of Business Funding

Our Consultants help early stage companies attract capital. Businesses at early stages typically have three sources of startup financing. First, companies are often successful raising capital from friends and family. Second, many companies attempt to get startup business loans. Third, many companies approach angel investor networks. We believe early stage companies benefit from employing all of these avenues for business financing. At CHI Consulting Group, we have proven ways to help your company with each source.

So-called “friends and family” money is often the first source of capital for a new business. Many times family members, friends and colleagues will provide start up loans or direct investment capital. This form of startup financing can get a company several months down the road. It also demonstrates to later angel investors that your company is worth seriously reviewing. However, attracting and securing this form of capital is not always easy. These funding sources will often demand that you have a business plan and a good financial summary. Some may even ask you to personally guarantee or collateralize a loan. We help you negotiate and conclude a deal with friends and family that will get you the early stage capital you need without crippling the company or your own assets.

Banks are a second good source of small business financing. Programs through the U.S. Small Business Administration can make getting such business financing easier. While you will still need to provide a personal guarantee and collateral, the SBA loan guarantee puts banks more at ease, making a loan to you less risky. Unfortunately, the application and review processes are not always simple. This is where we step in. We help you create a dazzling application, including a strong use of funds statement. This can often make the difference between acceptance and rejection. Small business funding through banks and the SBA are not the only routes, however. We can assist you in accessing unsecured business loans or an unsecured business line of credit without personal guarantees and collateral. To learn more click here

A third source of early stage capital is the angel investor networks. These networks invest up to approximately $1,000,000 in companies of all types each year. CHI Consulting Group assists clients in navigating the application and review process with groups nation-wide. We guide you through each step in the process by minimizing the mistakes most companies make with angel investors. To learn more click here

The Funding Strategy

Many companies seeking an angel investor or other early stage funding simply approach various sources without any plan or any idea of whether those funding sources are even appropriate to their business. Approaching funding this way is a sure-fire way to waste time and resources and to get a lot of rejections. A funding strategy helps you minimize time, resources and rejections on the road to funding by carefully assessing where your business stands. Our consultants do this by locating gaps, holes or missing pieces that are evident in your plans, team and presentations. We also identify key inflection points in your business: future points in time where additional funding or other resources are likely to be required.

The funding strategy tells you whether your company is currently best suited for a business loan, venture capital funding, government funding or angel investors; and the best sources of capital for future inflection points. In some cases your business may not be ready for any of these sources of capital, and you'll need to raise additional funds from friends and family or from current shareholders.

Our funding strategy process includes the following key elements and steps:

  •  A thorough review of all pertinent company documents, from business plans to incorporation documents and from tax returns to shareholder agreements. This provides the benefit of review and analysis of your materials by our seasoned team.
  •  Assessment of the strengths and weaknesses of your team, business model, business market or industry and your offering terms. This provides you the opportunity to express your vision, goals and potential to an experienced, objective listener who can spot weaknesses you might miss. 
  • An exchange of pertinent company documents for our analysis, review and inclusion into a preliminary due diligence binder. This gives you a readily accessible document repository that is very handy when talking to any investor or lender. 
  • A detailed report with recommended actions to bolster the weak spots in the business and a specific action plan to get you on the best road to funding. This provides your company with a solid resource to assess your weaknesses, ready your team and presentation materials, and steps to take now to bolster your overall funding attractiveness.
  • A follow up meeting to discuss the proposed strategy and to assess your readiness to proceed with funding. This helps you establish a firm footing upon which to begin to seeking funding from the most likely sources.

It is essential that you enter the funding game prepared in order to have the best chance of winning. A thorough funding strategy report is a proven way to minimize mistakes and maximize your chances of hearing "Yes!".

Call CHI Consulting Group today at 800-401-9171 Ext 702 to learn more about how a funding strategy can help you get on the right path to funding.

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