Continued Investing: Here, Now, Plus, the Future.

    Often, small business owners and entrepreneurs, unless they have a large savings, worked a lucrative job/career before hand, or some kind of inherited funding; have to turn to mainstream financing corporations to get the ball rolling. If the business is too new, personal financing information will be the sole decision maker on a yes or no. If the person applying has little, no, or bad credit, they will be turned down. Most places will ask for a co-signer or if the seeker is a risk, the establishment will suggest having someone else take a loan out for them. Many current and future business owners do not want to take the risk of someone else financing the back end, while other welcome it with open arms.

    There are benefits to both. Individual financing lets you work one on one with the lender and they have the choice to stay in the loop of the business details or good faith financing where they can ask for the the whole dollar amount, partial, or with/without interest back in several different ways. Terms are discussed between two parties that both deem as fair. It is suggested to get an attorney to look at any contract that is written to make sure all is in favor of both sides. If there is a close friend or family member, the exchange can be a bit less formal. Most small businesses start out that way. This “angel” or “peer to peer lending,”  makes the business more likely to have a higher drive to be successful since the lender has personal a personal connection.

    Other owners may want to not seek partners/ managing investors. The potential to have someone else control the financing requires a level of trust that may be unknown and/or the owner may not want to have the financier change the scope of the business, if that is within the terms of their lending.

    When the above mentioned options are of little or no success to gain working capitol, the next option can be crowd funding and privatized fundraising. Companies like Go Fund Me, Kick Starter, and IndiGoGo, are very popular places to turn. Most have rules and regulations to work with, but most people have the ability to setup an account to monitor and display progress to a goal. Some sites only offer funding after the desired amount is reached, while others, such as Go Fund Me, allows for withdrawals and immediate donations to the suggested cause. Some sites are for product based businesses and others are for anything. Some sites can even help people who are in need of money after or to avoid tragedy and hardship. Overall, this option depends on the investment of others to get people started. These investments are donations either to help out someone, thing that is up and coming. These donations often come with the promise of something in return, such as merchandise or whatever concept project the funding is for.

    Local business investing makes your community thrive, help a family or individual keep a roof over their head; plus celebrates a skill, product, or service that is unique. More often these businesses provide better quality then the major chain corporations out there. Small or family owned businesses need working capitol for startup fees or restructuring. Outside of the going to the bank, grant writing, or visiting the local chamber of commerce for potential investors; small businesses are turning to crowd funding or privatized fundraising/ donations.

    For the return items, there is usually a timeframe upon when the item(s) will be given. With good advertising, social media re-sharing, and word of mouth, the campaign can be successful to keep its promise. This will take a community of people to help it along. It cannot be solely left up to the individual(s) who need the funding. Supporters will have to show their support with their diligence in keeping the topic live so other people so they can donate too.

    With privatized fundraising, the door for donations can be simple or as elaborate as it needs to be. PayPal offers an addition to its many profit generating avenues called PayPal.me. With PayPal.me, businesses and/or individuals can have people donate or pay them without having to go through various sites, while giving an extra layer of security. There are no invoicing or email exchange. Its a simple pay this amount or donate to this person via this personalized website. PayPal.me can be a better way of sending money then wire transferring, or personal banking transferring. With the privacy protection that PayPal offers, and only listing the to and from info, senders and receivers can rest easy about the exchange. Since this option is available for anyone with PayPal account, it is suggested that the sources are checked to make sure the company is legit. For example, major/large corporations and political establishments more then likely will not use such a way to collect donations or payments.

    For small businesses, this can be an easy discreet way to have people pay them or collect donations. It works out great for startup businesses who may be in the service industry or have a skill set that, in the beginning, doesn't have any product to offer in return for the donations. One company, Devi Dance Studio, is currently using PayPal.me to accept donations to open a dance studio in the Kentuckiana Area. The owner and operator, Tahulla Setsena, has been a performer, continued student, and developer of dancers for several years. She saw a need to have an enhanced experience for her students, a safe place for dancers to meet and work on their skills, and over all share the love for multi-cultural dance with others. She is starting from the ground up, with no working capitol to make her dreams come to life. When asked about her plans and why she is using privatized fundraising she wrote.

    “It has been a longtime dream of mine to have a studio were dancers, can work on their craft. Many times, space has been limited, and to be a developed dancer; we must be able to practice. With a large open area and great sound, the possibilities are limitless on how far someone will be able to go. I would like my dance studio to be a peaceful, well respected place, for students, teachers, and experienced dancers. Somewhere they love to come. In order to do that, I will have to get funding from my community, friends, family, and others who are feeling generous.  Since I am starting fresh and changing careers, getting a business loan isn't an option at this time. I do plan on having traditional fundraising and/or using some of the other crowd funding sites if needed, but I need to be able to develop my advertising, the rest of the ground work, and secure a location to teach. I have already done a lot to make this happen. All  I need now is the money to do so. PayPal.me allows me to use the  donated money to get this critical layer accomplished, and not restrict on how generous someone would to be.” - Tahulla Setsena, Goddess Life with Tahulla Setsena and Devi Dance Studio.

     Like Tahulla, many small businesses have the skill set, concept, and/ or product, but they need the resources the get whatever it is out in the community. To donate to Tahulla's Cause click here or the banner below: Donate to Devi Dance Studio.

    So what about retirement for business owners and entrepreneurs? Generally, it is a good idea to open some kind of extra retirement account within 5-7 years of having your new company open.  Most banking establishments offer individual accounts like a 401k or have the ability to transfer any existing one from a prior company they might have worked for. Companies like Fidelity, and some credit unions accept individuals who want to maintain a 401k even after they have left a larger company. There is usually a time limit on obtaining these accounts. If the individual doesn't close or transfer the account; some prior employers will have the account closed, and a check issued to the account holder. Other times, these account can get backlogged. If the former employee isn't paying attention, the account might not be accessible after several years. In most cases, transferring an existing/older 401k can be rolled into an IRA or another type of investment wheel. Speaking with a well educated person in your banking institution will help determine what is best for your golden years.

    Putting your money away for tomorrow, or watching it grow in various ways is above all your own individual choice. No matter if its the here and now, with massive purchases of material items, or limited spending to have a rainy day fund; using money wisely and effectively is key. There are more forms in regards to potential wealth, growth, development, and saving. However, here at Reenie.Imaging we know there is only so much reading/scrolling our readers can do. In the future, we may explore more investment showcases. Investing can be a touchy subject since everyone's situation can be vastly different. For now, we are grateful to be able to discuss a small margin on a topic that was one of the main reasons for having the Business Spotlight section.

 

Thank you. - Reenie.Imaging Management

12/31/16

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