Top 8 Ways I Can Seek Investment from Private Equity Funds

By: Finance Guider Team

Creating an attractive business plan to gain funding from a private equity fund is not an easy task in this era, after witnessing the meltdown of the most financially strong firms in the 2008 crisis. This has become the need of the hour as people look to reduce credit card debt by investing. In contrast to known beliefs, making investors even think of investing needs more than just a creative plan presentation, and then the long wait until they decide to invest in your company. It may take a company years, even decades to get to reach to that “investment ready” status.

So if you are requiring seeking a decent investment from a private equity fund then following are basic guidelines that would hopefully help you attract investment from private equity funds:

Construct a management team

First of all, you need to make a shining and attractive board with people known for their experience and competency. Experienced and strong boards attract investment form every kind of fund including private equity funds. Investors are also looking for a decent relationship with the company and their boards, if in the future they plan on coming aboard.

Gain healthy advice

For good and healthy advice, the first thing you need a trustworthy competent advisor who should be a person who knows your business and every aspect of it. What you need is an advisor with years of experience preferably someone who has advised to pay off credit card debt faster since he can give you a professional and honest opinion on the state of the company, whether the firm is ready to take investment or not, and conducting accurate forecasts regarding the financial future.

Let your investor know you are worth the investment

Investors should be clarified and fully convinced that they are relying on a company after being shown a clear-cut picture of its strategy, financial status and history. A credit card debt history may also be a put off for investors as they see you, who is running the business, to be a potential defaulter. Presenting a factual proposal is necessary.

Point your position of current status

You should make your investors familiar with your company’s current position. Also, inform them about your current product/service and who your primary clientele, competitors and your target market are. Personal financial position should also be shown; investors are lenient to invest with owners who have credit card debt history since the 2008 crisis.

Show you can grow

A short and well-explained business plan with at least 3 year forecasts, growth and mission/vision strategies takes investors into confidence about the potential of your firm. Forecasts must be realistic and achievable.

While more firms are seeking investment from private equity funds for numerous reasons, a lot of businesses actually have no idea about how to attract investment from these funds.

Market comparison

You will find a lot of equity firms with similar terms and conditions but what you may also find out is that some equity funds specialize in investing in specific markets and industries. After 2008 equity firms usually require business owners to have a minimum record of any credit card debt to assess credibility. If you are looking for good high quality advice and specialized consulting around your business then attracting investment from a private equity fund with a good track record and experience with working in your industry is a good idea.

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Knowing what to expect

Think like the investor. Investors nowadays get background checks of the people running the business in which they are planning to invest. They check whether the owners have credit card debt or some other sort of debt to gauge the risk of a possible default. Make a list of all the questions that the investor would ask and all the assurances that the investor would be expecting.

Delivering the goods

There is no doubt that a fool-proof investment plan will allow you to attract and secure a good investment. What needs to be made clear is that the investor should be convinced by your plan. Make sure you are convincing and credible in every aspect including your own personal financial health (no credit card debt for example).

Know your business’ facts and figures inside out. Would you invest a large sum of money in someone who didn’t know their own business?

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