Why You Should Consider Scrapping This Unoriginal Type of Content

I’m not one for New Year’s resolutions. My personal resolutions always feel contrived, so several years ago I just stopped...

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Types of Crowdfunding for your Small Business

Types of Crowdfunding for your Small Business

Crowdfunding has become a viable form for funding a venture, project, cause, event and much more. For small businesses looking to bypass traditional sources of financing such as bank loans, angel investing or venture capital, it is now a great option.

If you’ve been thinking about starting a campaign, it is important to note there are different types of crowdfunding. And this doesn’t mean the platform or portal such as Kickstarter, Indiegogo and others.

The confusion stems from clumping crowdfunding under one umbrella, when in reality there are different types or models. Depending on your project, choosing the right model for your small business is critically important to ensure the success of your campaign.

Types of Crowdfunding

So before you get started, here is a quick primer on the different types of crowdfunding.

Rewards-Based Crowdfunding

When you talk about crowdfunding, the rewards-based model is what most people are familiar with. This is in great part due to the popularity of platforms such as Kickstarter and Indiegogo.

This type of crowdfunding is used to launch everything from ideas of a product to fully functional prototypes looking to go into full production. For the investors or contributors, the reward is getting to buy the item at a much lower price before it becomes available to the general public along with other incentives

In addition to a discounted price, businesses also offer meeting with founders, trip to company headquarters and more.

Rewards-based crowdfunding has multiple benefits for a small business. This includes access to cheap money because you don’t have to pay interest or dividends on the investment.

With the right platform, the campaign also serves as a marketing tool for the product. Early adopters become advocates who grow its popularity with word of mouth promotion. This is so effective, big brands are now introducing products with reward-based crowdfunding to test them before they launch it.

Equity Crowdfunding

As the name implies this model sells off small shares or equity of the business to investors with the goal of delivering returns if the business succeeds. And of all the types of crowdfunding, it is the most complicated of the bunch.

Equity crowdfunding can be used by any startup, but it is best suited for more established firms looking to expand and raise large sums of capital for their next stage of development.

Businesses who launch equity campaigns have minimums which are much higher than the other types of crowdfunding. They can start anywhere from $500 to $1,000 and go much higher.

The complexity lies in the SEC compliances businesses have to abide by when using equity crowdfunding. This includes disclosures such as financial statements, tax returns, price of the sold securities, and more. And this is why experienced businesses should use this model to raise funds with equity crowdfunding.

Another potential problem is you will be selling a part of your company. If you don’t want to answer to outside investors and all it entails, this might not be the right vehicle to fund your enterprise.

Peer to Peer or P2P Lending

As a crowdfunding model, peer to peer or P2P provides personal unsecured loans to small businesses or individuals. The P2P platforms bring together lenders and those looking for a loan.

If you are a small business looking for an alternative lender, P2P provides a solution.

The amount of the loan and interest rates depend on whether you are an individual or a business. Based on the platform individuals can apply anywhere from $1k to $35K or more, while small businesses can ask from $15K to $350K or more.

The interest rates may depend on the loan grade, your credit, platform and other factors. As any other loan, make sure you fully understand your liabilities before you apply.

As one of the types of crowdfunding which deal in lending money, P2P platforms have to abide by state regulations. This is why P2P lending is not available in all states. So, before you get going, make sure your state allows P2P lending.

Peer to Business or P2B Lending

Peer to business or P2B works the same way as the P2P model, but it specializes in loans to businesses.

This is one of the relatively new types of crowdfunding, but it is gaining traction because it gives small businesses yet another funding solution.

Just as the P2P model the amount and interest rate also depend on a variety of factors. Because the loan is given to businesses, lenders in most cases want an established company with collateral.

This might not be for everyone, but if you need quick cash with manageable interest rates, take a look at P2B crowdfunding.

Donation-Based Crowdfunding

If you happen to run a not for profit organization, a donation-based crowdfunding is a great option to support the causes you are passionate about.

Unlike the other types of crowdfunding, the goal here is to help a cause. This can be issues affecting your community, city, state, country or the world for that matter.

With this type of funding the contributors don’t get a product or shares of the company. This type of crowdfunding is another channel to highlight a particular cause and get support from like-minded individuals or organizations who believe in it.

What is Crowdfunding?

Even though it seems like there are many different types of crowdfunding, they are basically the same thing. They take money from individuals and make it available to people and businesses looking for funding.

Where they differ is in the implementation of the funds they receive from their contributors/investors and the segment they address.

For small businesses who want to launch a new product, get a loan, or support a cause it means they no longer have to depend on banks to make it happen. Crowdfunding is a real option.

Image: Depositphotos.com

This article, "Types of Crowdfunding for your Small Business" was first published on Small Business Trends



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Types of Crowdfunding for your Small Business

Types of Crowdfunding for your Small Business

Crowdfunding has become a viable form for funding a venture, project, cause, event and much more. For small businesses looking to bypass traditional sources of financing such as bank loans, angel investing or venture capital, it is now a great option.

If you’ve been thinking about starting a campaign, it is important to note there are different types of crowdfunding. And this doesn’t mean the platform or portal such as Kickstarter, Indiegogo and others.

The confusion stems from clumping crowdfunding under one umbrella, when in reality there are different types or models. Depending on your project, choosing the right model for your small business is critically important to ensure the success of your campaign.

Types of Crowdfunding

So before you get started, here is a quick primer on the different types of crowdfunding.

Rewards-Based Crowdfunding

When you talk about crowdfunding, the rewards-based model is what most people are familiar with. This is in great part due to the popularity of platforms such as Kickstarter and Indiegogo.

This type of crowdfunding is used to launch everything from ideas of a product to fully functional prototypes looking to go into full production. For the investors or contributors, the reward is getting to buy the item at a much lower price before it becomes available to the general public along with other incentives

In addition to a discounted price, businesses also offer meeting with founders, trip to company headquarters and more.

Rewards-based crowdfunding has multiple benefits for a small business. This includes access to cheap money because you don’t have to pay interest or dividends on the investment.

With the right platform, the campaign also serves as a marketing tool for the product. Early adopters become advocates who grow its popularity with word of mouth promotion. This is so effective, big brands are now introducing products with reward-based crowdfunding to test them before they launch it.

Equity Crowdfunding

As the name implies this model sells off small shares or equity of the business to investors with the goal of delivering returns if the business succeeds. And of all the types of crowdfunding, it is the most complicated of the bunch.

Equity crowdfunding can be used by any startup, but it is best suited for more established firms looking to expand and raise large sums of capital for their next stage of development.

Businesses who launch equity campaigns have minimums which are much higher than the other types of crowdfunding. They can start anywhere from $500 to $1,000 and go much higher.

The complexity lies in the SEC compliances businesses have to abide by when using equity crowdfunding. This includes disclosures such as financial statements, tax returns, price of the sold securities, and more. And this is why experienced businesses should use this model to raise funds with equity crowdfunding.

Another potential problem is you will be selling a part of your company. If you don’t want to answer to outside investors and all it entails, this might not be the right vehicle to fund your enterprise.

Peer to Peer or P2P Lending

As a crowdfunding model, peer to peer or P2P provides personal unsecured loans to small businesses or individuals. The P2P platforms bring together lenders and those looking for a loan.

If you are a small business looking for an alternative lender, P2P provides a solution.

The amount of the loan and interest rates depend on whether you are an individual or a business. Based on the platform individuals can apply anywhere from $1k to $35K or more, while small businesses can ask from $15K to $350K or more.

The interest rates may depend on the loan grade, your credit, platform and other factors. As any other loan, make sure you fully understand your liabilities before you apply.

As one of the types of crowdfunding which deal in lending money, P2P platforms have to abide by state regulations. This is why P2P lending is not available in all states. So, before you get going, make sure your state allows P2P lending.

Peer to Business or P2B Lending

Peer to business or P2B works the same way as the P2P model, but it specializes in loans to businesses.

This is one of the relatively new types of crowdfunding, but it is gaining traction because it gives small businesses yet another funding solution.

Just as the P2P model the amount and interest rate also depend on a variety of factors. Because the loan is given to businesses, lenders in most cases want an established company with collateral.

This might not be for everyone, but if you need quick cash with manageable interest rates, take a look at P2B crowdfunding.

Donation-Based Crowdfunding

If you happen to run a not for profit organization, a donation-based crowdfunding is a great option to support the causes you are passionate about.

Unlike the other types of crowdfunding, the goal here is to help a cause. This can be issues affecting your community, city, state, country or the world for that matter.

With this type of funding the contributors don’t get a product or shares of the company. This type of crowdfunding is another channel to highlight a particular cause and get support from like-minded individuals or organizations who believe in it.

What is Crowdfunding?

Even though it seems like there are many different types of crowdfunding, they are basically the same thing. They take money from individuals and make it available to people and businesses looking for funding.

Where they differ is in the implementation of the funds they receive from their contributors/investors and the segment they address.

For small businesses who want to launch a new product, get a loan, or support a cause it means they no longer have to depend on banks to make it happen. Crowdfunding is a real option.

Image: Depositphotos.com

This article, "Types of Crowdfunding for your Small Business" was first published on Small Business Trends



via Small Business Trends Business Feeds

NATSO Staff Share Product Mix Tips at AMBEST

Stocking the right product mix is central to not only meeting customers’ needs but also growing sales. NATSO has created a Product Mix To-Go Toolkit to help truckstop and travel plaza operators identify the right products for their locations.

Last year, Darren Schulte, vice president of membership for NATSO, and I shared tips and insight from the toolkit during AMBEST’s  30th annual meeting in Salt Lake City.

ProductMixtoGoToolkit.jpg

Schulte highlighted the five principles of a product mix: understand your customer, offer travel plaza must haves and specialty items that set your truckstop apart, avoid offering multiples of the same product, understand product life cycles and use that knowledge in sales, and understand what inventory is on hand and move out inventory that is dead.

“I am a huge proponent of knowing who is stopping at your location. You have to know who your customer is before determining what product mix you need,” Schulte said. 

To better understand customers, Schulte suggests operators ask themselves how many owner-operators they have compared to company drivers, if the majority of customers are four-wheel traffic or over-the-road truck drivers or if they see more local customers than travelers. He also recommends customer surveys and examining shopper behavior to understand if a location sees buyers or shoppers.

“Understanding the difference between shoppers and buyers can help operators tailor promotions to boost sales,” Schulte said. 

During the session, Schulte also offered tips for finding and stocking carefully selected unique products and specialty categories as well as managing inventory and SKUs. While unproductive inventory is often a cost of doing business, understanding the actual cost of dead inventory and finding effective ways to move it along can free up space for more profitable products.

These topics and more, including ten product mix no-no’s, are covered in more detail within NATSO's Product Mix To-Go Toolkit, which is available to download here.



via Business Feeds

4 Benefits to Connecting Your Appointments and Invoices

Just because you work hard to offer the best to your clients, doesn’t mean you shouldn’t accept help when it could be necessary. By now, there are so many online tools and software solutions that can make things easier on you. While you are busy running your small business, these helpful tools can give you peace of mind.

Appointment booking system

If you run a salon, HR department, consulting firm, pet care service, or any other type of business that requires booking appointments and service scheduling, you’ve probably looked into the available appointment booking software online.

Booking these appointments is only the first step in making online tools work for you.…

The post 4 Benefits to Connecting Your Appointments and Invoices appeared first on SMALL BUSINESS CEO.



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Apply These 5 Secrets for Getting a Loan and Surviving in a Bear Market

Can a Small Business Get a Loan in a Bear Market?

Finding a loan is an important part of getting up and running or staying on track through the ups and downs of owning a small business. Well over half of entrepreneurs recently reported they weren’t sure they had enough cash to even start their businesses.

Small Business Trends got in touch with Krista Morgan, CEO and co-founder of P2Binvestor, to find out if and how small business can get a loan in a bear market.

She started by defining the term for us via email.

“In a bear market, banks become more risk-averse and will either 1) not provide SMBs financing at all or 2) provide loans to these small businesses at unfavorable rates,” she writes.

Look Beyond More Traditional Lenders

There’s a case that this is the situation now. The Small Business Administration (SBA) has halted SMB loan programs as of Dec 22 due to the ongoing government shutdown.  There’s a ripple effect that’s being felt by American banks causing them to curb the money they make available for small businesses too.

Morgan stresses there’s still a bright side because the market is diverse:

“Small businesses are fortunate with the wide variety of lending options that are currently available. With banks being more selective to whom they provide loans, alternative lending options become the obvious choice for these small businesses to access financing.”

Realize APRs will Be Higher

Still, she adds a caveat pointing to the fact that small businesses need to be aware that the APR’s and repayment terms, should they be able to get a loan from a bank or alternative institution, won’t be as low as they would in a better market. The Annual Percentage Rate (APR) is the amount charged on any loan over twelve months.

Seek Out Alternative Lenders  as an Option

There’s at least one solution that was designed specifically to support SMB’s during down times when loan money is scarce.

Online alternative lenders were built to support and fund SMBs during down markets,” Morgan writes. “For example, P2Binvestor was built to provide high-end lines of credit to businesses that can’t receive bank financing. So, if banks become more selective and restrictive during a bear market, SMBs know they can access a large pipeline of lenders in order to get the financing they need.”

Develop a Plan for Market Downswings

Small businesses aren’t totally at the mercy of market swings either. Morgan writes that they should have a plan on how to withstand one of these bear markets and even succeed during a downturn. She writes that both banks and alternative lending institutions will be looking to see if any small business has put one of these financial battle plans in place.

She offers a tip:

“The more diversity you have in your payor base provides more security and confidence so even if some of your payors fall off the map during a recession, you still can sell your product or service and be successful.”

Morgan also cautions against taking on large loans because SMBs think their company can grow at a rapid pace during a bear market. She points out that it’s improbable any small business will grow at the same rate it did during a more lucrative bull market. Small businesses taking on loans during leaner times should focus on having money to operate businesses and get over any financial and market humps.

Although she says there aren’t any specific small businesses that stand a better chance than others of surviving a bear market, those that sell high-end luxury goods tend to take a bigger hit during downswings.

Develop a Must-Have Feeling for your Product

“Buyer behavior typically shifts when the market is down and people decide to buy ‘store brand’ goods as opposed to more select ‘niche’ products,” she writes. “At the same time, it is up to these niche businesses to market the product/service need to their customers.”

Finally, Morgan says if a business can stoke that “must have” feeling for their product or service by ramping up demand during the downtime, they should be successful regardless of the market cycle.

Image: Depositphotos.com

This article, "Apply These 5 Secrets for Getting a Loan and Surviving in a Bear Market" was first published on Small Business Trends



RSS Business Feeds

Apply These 5 Secrets for Getting a Loan and Surviving in a Bear Market

Can a Small Business Get a Loan in a Bear Market?

Finding a loan is an important part of getting up and running or staying on track through the ups and downs of owning a small business. Well over half of entrepreneurs recently reported they weren’t sure they had enough cash to even start their businesses.

Small Business Trends got in touch with Krista Morgan, CEO and co-founder of P2Binvestor, to find out if and how small business can get a loan in a bear market.

She started by defining the term for us via email.

“In a bear market, banks become more risk-averse and will either 1) not provide SMBs financing at all or 2) provide loans to these small businesses at unfavorable rates,” she writes.

Look Beyond More Traditional Lenders

There’s a case that this is the situation now. The Small Business Administration (SBA) has halted SMB loan programs as of Dec 22 due to the ongoing government shutdown.  There’s a ripple effect that’s being felt by American banks causing them to curb the money they make available for small businesses too.

Morgan stresses there’s still a bright side because the market is diverse:

“Small businesses are fortunate with the wide variety of lending options that are currently available. With banks being more selective to whom they provide loans, alternative lending options become the obvious choice for these small businesses to access financing.”

Realize APRs will Be Higher

Still, she adds a caveat pointing to the fact that small businesses need to be aware that the APR’s and repayment terms, should they be able to get a loan from a bank or alternative institution, won’t be as low as they would in a better market. The Annual Percentage Rate (APR) is the amount charged on any loan over twelve months.

Seek Out Alternative Lenders  as an Option

There’s at least one solution that was designed specifically to support SMB’s during down times when loan money is scarce.

Online alternative lenders were built to support and fund SMBs during down markets,” Morgan writes. “For example, P2Binvestor was built to provide high-end lines of credit to businesses that can’t receive bank financing. So, if banks become more selective and restrictive during a bear market, SMBs know they can access a large pipeline of lenders in order to get the financing they need.”

Develop a Plan for Market Downswings

Small businesses aren’t totally at the mercy of market swings either. Morgan writes that they should have a plan on how to withstand one of these bear markets and even succeed during a downturn. She writes that both banks and alternative lending institutions will be looking to see if any small business has put one of these financial battle plans in place.

She offers a tip:

“The more diversity you have in your payor base provides more security and confidence so even if some of your payors fall off the map during a recession, you still can sell your product or service and be successful.”

Morgan also cautions against taking on large loans because SMBs think their company can grow at a rapid pace during a bear market. She points out that it’s improbable any small business will grow at the same rate it did during a more lucrative bull market. Small businesses taking on loans during leaner times should focus on having money to operate businesses and get over any financial and market humps.

Although she says there aren’t any specific small businesses that stand a better chance than others of surviving a bear market, those that sell high-end luxury goods tend to take a bigger hit during downswings.

Develop a Must-Have Feeling for your Product

“Buyer behavior typically shifts when the market is down and people decide to buy ‘store brand’ goods as opposed to more select ‘niche’ products,” she writes. “At the same time, it is up to these niche businesses to market the product/service need to their customers.”

Finally, Morgan says if a business can stoke that “must have” feeling for their product or service by ramping up demand during the downtime, they should be successful regardless of the market cycle.

Image: Depositphotos.com

This article, "Apply These 5 Secrets for Getting a Loan and Surviving in a Bear Market" was first published on Small Business Trends



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