Helene Panzarino

Cheat Sheet / Updated 04-20-2022

Funding for your business can come from a bank in the form of a loan or from a variety of other sources. You may draw on support from friends and family, strangers connected through the Internet, or investors, including business angels and venture capitalists. You can also create a revenue stream through your invoices or sell shares.

Article / Updated 03-26-2016

You may not be able to obtain a bank loan for your business or a loan at terms that are acceptable depending on the stage your business is at and the risk profile of you and the sector your business is in, so casting into fresh waters may be required. However, other forms of business debt finance are out there, whether your need is for working capital, expansion or physical growth. Alternative funding sources may be better suited to your purpose: Overdraft: If you have a cyclical business or a fluctuating cash flow, and your funding need is short term, a bank overdraft facility that you can pay interest on as you draw down could be a good solution. Invoice finance: If you have invoice payments that are due to you from pretty solidly run and financially secure companies that are taking a long time to pay, you can essentially sell off your invoices for a straight advance or via an auction platform, like Market Invoice for example, and get a large percentage of the money due upfront, with the rest to follow, in exchange for admin fees and interest costs. Merchant cash advance: If your business takes credit-card payments, then you can borrow against future revenue on a short-term basis. Peer-to-peer loans: A bit like crowdfunding for debt, peer-to-peer lending lets people lend to businesses in return for better interest rates than they get elsewhere. Your business stands a better chance of getting some funding in quicker and maybe at a better rate than through a bank loan. You need to put some information around key business data on the site, and there is an underwriting process, but the concept is increasing in popularity, with platforms like Funding Circle leading the way. Asset finance: Asset-based funding lets you borrow against the value of an asset you need to acquire, be it equipment, premises or stock. You can approach specialist providers such as Close Brothers, or most banks have a separate asset finance firm. Family lending: One alternative to a traditional bank loan is a loan from the bank of mum and dad or some other family member willing and able to lend your business some money. Often you get this money at a much more favourable rate than you'd get in the open market. Just remember to get it all agreed in a legal document. Equity: If you're happy to sell a stake in your business, then equity finance could be an answer. It comes in a variety of guises from individual or small groups of business angels to venture capital funds, crowdfunding platforms and private equity houses. Angel investors come into your business earlier than most equity investors, and for smaller amounts, making the most of the UK tax-incentive schemes for investors. Venture capitalists sometimes come in at a relatively early stage in your business but are more likely to be your second significant round of funding. Private equity firms tend to come in much later, as you prepare for a stock exchange listing or some other kind of exit, and for much larger amounts, with many of them starting to invest at the £10 million mark. Crowdfunding: You can harness the power of the masses by offering shares or rewards in your business in exchange for funding using crowdfunding platforms such as Seedrs, Crowdbnk and Crowdcube. The bonus byproduct is widening your market exposure and gaining additional customers.

Article / Updated 03-26-2016

When the time is right for you to exit your business, you have a number of options, including selling your business to a third-party trade buyer in a trade sale or via a business auction arrangement. You can sell either part of your business or the whole concern. A trade sale, or selling your business to a trade buyer, usually includes the shares and assets and sometimes the liabilities. Generally, a trade sale means that you can withdraw from full time activity in the business, often after a handover period, and open the door to become a consultant to the new firm, broker bigger deals for the new firm or just step back and let the new team take it forward. Potential trade buyers for your business fall into one of two categories: The strategic buyer sees the synergy between the two businesses and often is already operating in the same industry or sector. This type of buyer recognizes the strengths and weaknesses of each business and sees a way to buy in the strengths of your business to enhance her position in the market. If the potential buyer has been struggling to access new or foreign markets, for example, and your business has a firm foothold in exports, a trade sale could save her time and money and provide an instant foothold in an otherwise unobtainable marketplace. Even more enticing may be the prospect of getting her hands on patents or design rights, again saving time and money, and protecting her entry into a new business area. Pros of selling to a strategic buyer include You may get a higher price for your business. You may have the option to exit your business completely, after a handover or earn-out period. You may be offered a reduced but important role in the new business. The sale may enhance the market position and share value of the new business, which will be of interest to you if you retain some shares.. Familiarity of your sector may make the process of selling quicker and easier as your potential buyer knows the characteristics and quirks of your industry. The due diligence process before the sale will go more quickly. If the buyer is known to your customers and suppliers, it could make the transition to the new business less disruptive and less damaging to sales. On the other hand, selling your business to a strategic buyer may have some cons: The business ceases to operate smoothly and efficiently during the sale process, alarming customers and staff and potentially having a negative short-term effect on trading. Your senior team know that some or all of them will get the ax, and there is a potential negative impact on performance, morale and attendance, as well as the security of sensitive data. Customers may not like the potential buyer and vote with their feet, moving their business elsewhere. The sale may have a negative effect on company value depending on how the market sees the move. If the sale doesn't go ahead, your company information has potentially been seen and digested by a competitor. The financial buyer may have deep pockets with lots of cash to spend and be looking for an acquisition that will reap financial rewards in the short-to-medium term, either by a further sale or some form of consolidation in the market. Unlike the strategic buyer, the financial buyer generally has no industry expertise and isn't looking for a commercial blending or synergy. She's motivated by the opportunity to acquire a business that's undervalued in order to bolster it with financial support, fattening the golden goose for an even greater return in the not-too-distant future. Funding her purchase with a combination of equity and debt, she may see an industry that's particularly active in creating financial gains, and both your business and the industry it sits in are attractive to her. Selling your business to a financial buyer brings some potential positives: The buyer may be able to offer some innovative or flexible financing arrangements for the sale. You'll probably retain a key role in the new business for a significant period of time, ensuring expertise and continuity and possibly additional financial rewards linked to performance. Business operating disruption is kept to a minimum, limiting impact on customers. Employee morale is less negatively affected than in a sale to a strategic buyer. If protecting the roles of your senior team is important to you, they are very likely to be staying on. If the financial buyer has a healthy war chest, there may be future opportunities for growth by additional acquisitions. Cons of selling to a financial buyer include You're likely to stay involved in the business for at least a year after the sale, which may not be the best scenario for you, depending on your goals. The buyer's lack of expertise in the market means that the due diligence process will take longer and delay the actual sale. Due to the higher leverage from using debt for the purchase, there's potentially not much cash to fund growth about the place and also margins will need to be optimized at all times. Financial reporting will be very detailed and happen very often. If a strategic buyer is looking to create a powerful synergy and is sympathetic to maintaining some of the fabric and manpower in your business, you may get a better financial deal than you might with a financial buyer. It's up to you to take a frank look at your business and identify what might be of more value to each type of buyer, and anticipate how to use your bargaining chips in any negotiations. It's also important to consider the impact of each type of buyer on your staff, your customers and your company legacy, as well as on your shareholders, if applicable. The highest bidder may not be the best option if your reasons for selling extend beyond financial gains, but only you can decide what matters most. Your ultimate business and personal goals and reasons for selling, be they financial, physical, emotional or just wanting a reduced workload with some control so you can enjoy what you've created, help you identify the type and potential shortlist for a trade sale, but you're not alone in what can be a very daunting process. There are plenty of corporate finance advisers who can help you, but the final decision rests with you.

Article / Updated 03-26-2016

Luckily for entrepreneurs looking to raise funding for their businesses, the UK enjoys very attractive tax incentive schemes for equity investors, making it that much easier for investors to see some of the practical benefits to getting on board. It's obvious to most that investing in a smaller company carries more financial risk than investing in a larger business, and correspondingly, an investment in a small business carries great potential rewards. The UK government tries to help keep the investment flowing into these companies via two Established by the Chancellor in 1994, initially with tax-incentive schemes – the EIS (Enterprise Investment Scheme), and further extended to SEIS (Seed Enterprise Investment Scheme). Both in 2012, both tax incentive schemes are very popular with entrepreneurs and investors. Certain types of businesses don't qualify for SEIS or EIS investment, and these businesses include those providing legal or accountancy services; those dealing in land or property development; businesses dealing in commodities, futures, shares, securities and other financial activities; those whose focus is on leasing, including hiring of assets, energy generation, and so on. It's obvious to most that investing in smaller companies carries more financial risk, and correspondingly, great potential rewards, and the UK government tries to help keep the investment flowing into these companies via the schemes. SEIS and EIS funds are managed by professional fund managers. SEIS and EIS networks and crowdfunding sites club together to source investments and co-invest, which also adds to the pool of potential investors. As with all things financial, it's best to seek professionally qualified advice before embarking on either of these schemes. If your accountant is a qualified chartered accountant, she may also be a person to consult. For information on the process, forms, criteria and timings of the schemes, you can also look at the government's Seed Enterprise Investment Scheme page (or ) and HMRC's (Her Majesty's Revenue & Customs) website for information and guidance on accessing the schemes. SEIS and business funding EIS, the first of the two initiatives, was originally set up to encourage individual investors to invest in smaller businesses, to help stimulate the economy, and indeed individuals do still utilise the schemes. What's changed from the early days is that you now have SEIS and EIS funds, managed by professional fund managers, and SEIS and EIS networks and crowdfunding sites, who club together to source investments and co-invest also adding to the pool of potential investors. As two of the most popular tax initiatives offered to UK tax payers by the UK government, some points to consider when thinking about using them to fund your high growth or innovative business include: SEIS, the (Seed Enterprise Investment Scheme, offers tax incentives to those who invest in) Suitable for early- stage companiesy (less than two years old) investments with unlisted shares (share not quoted on a major stock market.) shares Most companies that use SEIS go on to use the EIS tax-incentive scheme. Points to keep in mind about SEIS include The company needs to have 50 or fewer staff members, and gross assets (all the assets which would be shown on a balance sheet) of a maximum of £200,000 before the investment. A company can receive up to £150,000 of investment under the scheme. Individual investors can invest up to £100,000 per year. Investors annum, but they cannot be employed by the company. Income tax relief to investor at 50 per cent of the cost of shares subscribed for, assuming the investor has to pay y have tax to pay. Dividends paid on SEIS shares are subject to tax. A simple SEIS example of how SEIS works: A: An individual investor earning £155,000 in taxable earnings during 2014/2015 is will be liable for approximately £55,880 in income tax for the year. An investment of £100,000 in an SEIS company would generates a tax savings of £50,000 against that tax liability, leaving a net income tax bill of approximately £5,880. (Source: Vipul Somaiya at www.taxplusaccountants.com.) This example has no regulatory status and provides an overview only. It should not be used as a definitive guide, since individual circumstances may vary. Specific advice should be obtained where necessary. EIS and business funding EIS, the Enterprise Investment Scheme, was established in 1994 to encourage individual investors to invest in small businesses in order to help stimulate the economy, and individuals still utilise the scheme today. Highlights of EIS include A company needs to have 250 employees or fewer and maximum gross assets of less than £16 million. Income tax relief to the investor is at 30 per cent of the amount invested in new shares. Individual investors can invest up to £1 million per year with annum, but there is no minimum investment amount. As with SEIS, the investor must not have a substantial interest in the company. A qualifying company can receive up to £5 million. Dividends paid on EIS shares are subject to tax. EIS practical example To makes the maths easy in this example, assume an EIS investor invests £10,000 and is in the 45 per cent tax bracket. If the company does well and doubles in value, and the investor holds her shares for three years, her income tax relief would be £3,000. If she sells the shares after three years, capital gains tax relief would be £0. In this scenario, the investor would gain £10,000 profit from the sale of the shares, plus his £3,000 in income tax relief for a total of £13,000. (Source: Vipul Somaiya at www.taxplusaccountants.com.) Disclaimer: this example has no regulatory status and provides an overview. It should not be used as a definitive guide, since individual circumstances may vary. Specific advice should be obtained where necessary. Certain types of businesses don't qualify for SEIS or EIS investment, and these include providing legal or accountancy services, dealing in land or property development, dealing in commodities, futures, shares, securities and other financial activities, leasing, including hire of assets, energy generation, and so on. As with all things financial, it's best to seek professionally qualified advice before embarking on either of these schemes. If your accountant is a qualified chartered accountant, he may also be a person to consult.

Article / Updated 03-26-2016

To yet a 'yes' for your own loan application, it helps if you can think more like a banker when preparing and presenting the information in your business loan application. By nature, banks are risk averse doing everything possible to ensure they lend only to businesses able to repay the debt and interest. After all, lending funds one of the ways in which banks make money, and they use other people's money in the form of deposited funds to make business loans. They have a duty to protect this money while making some profit for the bank. Banks like a positive trading track record that gives them confidence you'll be able to make the repayments they require, and you need to be aware of this when entering into discussions with your banker. You can understand, then, why the answer to many small- and medium-sized businesses loan applications is often 'no'. Keep in mind that bankers are Relatively conservative in their outlook. Guided by facts and figures. Averse to excessive and uncalculated risk. Need to see Plan B case you can't meet your repayment obligations. (Bear in mind that you, not your business, may be the one making the repayments.) Very keen on having paperwork to back up the information in your application. If you get turned down by your bank, learn from the experience Ask questions about why your application was declined and use the banker as a learning resource and ally. Don't be put off from appealing the decision or applying elsewhere. Your business loan application may be rejected due to A poor trading and earnings history A lack of a trading history A poorly written and presented business plan and financial forecast Too much debt or other financial obligations already, putting your ability to repay this debt into question Previous defaults on repayments or restructuring, indicating difficulty in making payments when times are tough Weak financial or accounting systems thatindicate a lack of control and awareness of finances Very little in the way of collateral in your business or personal finances Something questionable in your character or prior business dealings, like a county court judgement or a problem with a directorship To help you get a positive lending decision from your banker, use these tips: Take care in preparing and presenting your documentation. Make sure you prepare your documentation with both your business and the bank's risk profile in mind. Know your audience and prepare accordingly. Make sure your business plan clearly states how much money you require, exactly what you'll use it for and what return will be generated as a result of obtaining the funds. Your financials should be up-to-date and include cash-flow forecasts that illustrate your ability to repay the debt, along with forecasts of profit and loss statements. Your aim is to minimise any doubt or risk concerns in your banker's mind, and make him feel like you're a credible owner of a well-run business, with a very clear need for funding that will generate enough of a return to fulfill his terms and allow him to rest easy. Bankers don't like surprises. If there's something untoward or potentially problematic lurking in your business or in your business plan, don't try to hide it or cover it up. Get it out in the open, but be prepared with a solution to minimise the risk it presents or to solve the problem it poses. Check your personal and business credit records. You may have something nasty sitting on your credit file that you're not even aware of – it happens often. Check your credit report, try to resolve any problems and have an answer for any questions it might raise. You can check your credit record on a number of websites; the most common are Experian and Equifax. Cultivate a relationship with your banker. In seeking a loan, if you have an ongoing business relationship with your banker, try him first. It's hard to approach a complete stranger for money when you need it the most. Getting to know your bank manager may not result in a successful loan application, but it may make him more likely to give you a frank and honest assessment of why your business gets turned down, helping you not make the same mistakes twice. Look beyond your own bank. It's easy to fall into the habit of always going to your own bank for funding, but banking doesn't have to be a monogamous relationship. You can have more than one banking relationship, and you may find that another bank can offer you what you need. A decline from one bank may be determined by internal bank restrictions that have nothing to do with you as a business, so it pays to shop around. A second opinion or counter-offer could be a helpful tool in negotiating a better deal from you own bank. Either way, talking to other banks gives you a better idea of what's available on the open market, and may help you get to 'yes'.

Article / Updated 03-26-2016

Funding for your business comes in all shapes and sizes, and finding the right source of funding at the right time can sometimes be a very confusing exercise and take a lot of work, time and effort. You just have to accept that as part of the process. It can also be made a little less overwhelming by knowing whether you need to look beyond your own resources and to external sources of funding, and if so, what type and where you might find some useful contacts and information. Internal business funding sources As a business owner, you may automatically assume that you need to look outside for funds in order to launch or grow your business and overlook the funding options on your own doorstep or within your business. Before you jump to the conclusion that you must sell shares in your business or approach your less-than-helpful bank manager, it's a good idea to take an internal audit of your own finances and options to raise finance, and see if any of those are appropriate for your business at this time. Internal funding options may include Friends and family: Friends and family can be a great source of encouragement and your biggest fans when you're looking to start or grow your business. They can also be a good source of cash, and often at more favourable rates than banks or other lenders. You can accept their help as either lenders or equity holders in your business. Take care though, because mixing business with family can be fraught with emotion and unrealistic expectations, so as with all forms of funding agree the terms of the loan or investment up front, making sure everyone knows where he stands whether the business is a success, a failure or something in-between. Savings: If you're lucky enough to have some money in the bank for a rainy day or a great opportunity, and with interest rates remaining low, you may want to put your money to work for you. Remembering to leave some money in the bank for unexpected downpours, you can feel a little smug and a lot less beholden to anyone else by using your own money to fund your business. No interest payments, no shares sold and a clear sign to any future funders that you're committed enough to put your own money on the line. Equity from property: You may be fortunate enough to have equity in your house or flat that means you can increase your mortgage and borrow against the value of the property or use it as an asset to pledge as security for borrowing from an online lender or for a bank loan. As with all things to do with the place you and your family call home, make sure you do your research, take advice from a financial advisor and that you understand all the implications involved in this type of finance, which include the possibility that you could lose your home, before you decide to access this type of funding. Redundancy payments: Every cloud has a silver lining, and if you've been on the receiving end of a redundancy payment, it can be a good source of start-up capital to help make your next big idea a reality. Pension release: Recent changes in the rules surrounding pensions mean that at the age of 55 you can tap into a certain percentage of your pension funds, tax free, albeit with many restrictions and an impact on your tax and future pension withdrawals, but it is now an option. I cannot stress enough the need to take advice from a fully qualified financial advisor before going down this route, as there could be serious negative implications if you get it wrong. A good starting point is Pension wise. Credit cards: If you're able to obtain a relatively small amount of money with zero or a very low percent of interest for a limited amount of time, and to pay if off quickly, using a credit card may be one way of getting some funding to put into your business. Be very clear about the terms and conditions of credit card finance, and if necessary, take advice from a qualified financial advisor before going down this route. If you're on a zero percent interest rate, there's a very good chance that you won't be able to repay the debt once that zero percent special offer expires, so be very frank with yourself before signing on the dotted line. Organic growth with minimal or no added funds: If you have the type of business that takes payment before you deliver a service or a product, then you may be able to fund your business from regular trading income. If you have skills or help to create your own simple website, then you may be able to spend a small amount to get your business going, take payment up front or in advance and then reinvest profits back into the business to keep it growing. It's a good option if you're risk averse or on a very tight budget, although it may not be the express train to millionaire status for quite a few years to come. External business funding options External sources of funding include banks, crowdfunding platforms and specialist or niche finance companies that help with financing trade transactions or slow paying invoices, as well as equity investors who put money into your business in exchange for a share of the ownership. Some of your external funding options include: Banks and loans: If anecdotal evidence is to be believed, small business loans are hard to come by these days. That's not to say they're non-existent however. There's still money out there and the banks haven't closed shop completely. You need a solid business plan and a clear idea of when and how your revenue will come in before a bank will even sit down with you, though. If you haven't got the assets behind you to guarantee the loan yourself, make sure you ask your bank about the Enterprise Finance Guarantee (EFG) scheme, which the government introduced to help small businesses secure finance. Check Startup Loans for resources. Bank overdraft: If your need for finance is short term or is a recurring short-term need, such as inventory for a fashion business where lead times are notoriously long, and you have recurring revenue and healthy margins, you may be able to secure temporary, short-term finance in the form of an overdraft from the bank you use for your business current account. Be aware that interest rates on overdrafts can be very high, and this type of finance is for short-term needs, but don't dismiss it out of hand. Invoice finance: Invoice finance is a type of debt that involves borrowing against an invoice or a receivable in order to get some cash into your business quicker than your payment terms allow. Once approved, you get a certain percentage of the money due usually within a week, albeit with fees to pay for the service, and the rest when the invoice is settled in full. Invoice financing takes a variety of formats, and can be obtained from your bank's invoice sister company for example, or from online auction platforms or companies that advance their own pot of money. Do your homework and choose the best solution for your business. Crowdfunding: Crowdfunding can take the form of debt, equity or donations, and is essentially harnessing the funding power of the many, as in the crowd, to raise money for your project, business or venture. Usually, you have many investors investing a small amount of money each, but sometimes you have some larger investors in the mix. This type of funding is a good way for you to let you friends, family and other associates get involved in your business. Crowdfunding is usually done using an online intermediary in the form of a platform that uses a sophisticated algorithm behind the scenes. Campaigns, which require a good deal of promotion in your network, on social media and so forth, are created and uploaded with a specific funding target in mind, for a set period of time, and you and your potential investors, can chart its progress online. Most people assume that crowdfunding is suitable only for start-up businesses, but it's also a good way for more established businesses to raise funds and also find a new customer audience. You can find additional information at the Crowdfunding Association website. Business angels: Don't let Dragons' Den on BBC2 put you off considering a business angel as an investor in your business. Most business angels are not of the fire-breathing ilk, but rather on the lookout for a good investment with a strong return – often in something they have some experience of. A business angel can be a colleague, a former employer, a professional in your business network or someone you find through a funding network. They invest cash in exchange for a share in your business, and may or may not take an active role in the company, depending on what you agree. A good starting point for an overview of many angels is the website of the UK Business Angel Association. Venture capitalists: Usually, but not exclusively, for the post start-up phase of your business funding needs, venture capitalists often follow on from an angel funder or step in once your business has a good trading track record. They generally look for a five-year investment in your high-growth business with a significant return on their money. So if you've got big plans and shares you're happy to sell for money and expertise, these guys could be your answer. The British Private Equity & Venture Capital Corporation website is worth exploring. Grants: There are literally thousands of different types of business grants available. The hard part is finding them and getting through the application process, which can be long and arduous. However, if you or your business qualifies, a grant can provide the financial impetus your idea needs to either get off the ground or grow into something bigger and better. More on business grants can be found at www.innovateuk.gov.uk. Corporate venture capital: Increasingly, large corporations are looking for the next big thing or the innovative start-up that they can invest money in and incubate with resources and mentoring in order to work together to bring something new and exciting to the market. If you've got a great idea and want to explore this David-and-Goliath type arrangement, you could find your business receiving a substantial leg up in the form of office space, finance, research and resources, but you'll also have to be comfortable with not having it all your way anymore. The quid pro quo for working under the wing of a giant is giving up some control and say in your future direction. For more information on corporate venture funds, see the British Private Equity & Venture Capital Association website. Competitions: There's no one source of information on where to find competitions that you can enter and are suitable for your business, but if you subscribe to newsletters and browse business websites, especially those specific to your sector, you're sure to see competitions advertised. You might be a growth company that's able to apply for a high street bank competition that offers a cash prize as well as mentoring from industry specialists; you might be a tech business that can enter a competition to win space, money and mentoring from a tech incubator or accelerator in your area; you might be a business that offers an eco-friendly solution to a city's energy or efficiency problems, and enter competitions in accelerators, foundations, or those put on by corporate sponsors. There are many competitions out there, and not just for start-ups, but the onus is on you to use the Internet, your networks, your industry websites, and your business support and mentoring resources to identify them and apply for them.

Article / Updated 03-26-2016

For many businesses, crowdfunding can be an extremely effective method for raising funds and expanding your customer database, as it acts like a marketing tool as well. What you may not realise is that there's more to a crowdfunding campaign than just putting a video up on a website. You need to prepare your proposition well, use words as well as images and be very active in spreading the word about what and how much you are doing and raising. Some useful tips follow: Thoroughly prepare your content. Preparation is key to a successful campaign, and you need to allow ample time to get your documentation, video pitch and marketing campaign right. It should be a team effort, spreading the workload and making sure there are no gaps. Creating a compelling story is vital when engaging your network of advocates and future investors. Work with your advisors or chosen platform team to build a detailed and well-structured Investment Memorandum and make sure you have all the required documents to present your business as a vetted investment opportunity to all types of investors. When you upload your information to the fundraising platform, it's important to remember to tell your potential investors What your product or service is. What sets you apart from your competition. How your business generates revenue. Why they should invest in you. What's your investment offer. What's your exit strategy. Put the same information on your own website, and link it to the crowdfunding profile. Record your pitch video. Your funding video is a powerful way to tell your story and plays a particularly important role in getting potential investors interested in your business. Make your video short, clear, authentic, and be sure to include a call to action. The optimal length for your pitch videos is 2-1/2 minutes. You don't want to sound stilted or rehearsed, but you need to have some sort of script to keep you focused and within a good time limit. Some of the things you might want to include are: Introduce yourself. Explain your product or service. Describe what's unique about your business; what makes you stand out. Make your pitch jargon free, use humour carefully and sparingly, and let your true self shine through. Talk about your business model and how you generate revenue. Share any achievements to date. Tell the audience what your business is valued at. State how much you're looking to raise. Explain what's the money will be used for. Tell the audience what you and the team bring to the business – why you're amazing. Give viewers a reason to invest. Describe the potential reward in return for the risk investors take. Make sure that your video is playable in high definition on YouTube and that it looks as professional as your budget will allow. The resolution and file size of images should be as big as possible and in landscape mode (at least 850 by 480 in JPEG or PNG). Individual images of team members should be in portrait mode. Share your pitch deck. A good pitch deck is creative and clear. Try to limit it to ten slides for a crowdfunding site. Stick to graphics, tables and images, and avoid heaps of text. The following suggested outline is a more detailed version of questions you've already addressed in your funding video and will help you to create a convincing pitch: Short description: Describe your company in one inspiring sentence. Product and benefits: Describe your product/service and explain the customer benefits. Your market: Describe your target customers, the market potential, your competitors and your unique selling point (USP). Business model: Explain how the business makes money and how scalable the model is. Traction: Explain your commercial activity to date. What do sales look like? What stage are you at with your product or service? What are your goals for the future? The team: Introduce your team and include photos. Also list your key advisers, partners and mentors. Funding: Share what your business valued at. State how much you're looking to raise and what is the capital for. If the business SEIS/EIS approved, share that? Contact information: Tell potential investors how to find you! Provide contact details, and some key company facts like the date of incorporation and your company registration number, if you have one. call to action: Tell viewers what you want them to do now they've seen the video. Include an interview. It's important for investors to get to know you so they have an understanding not only of the business, but of the minds behind it. You can upload an informal a 'question and answer' session in that you can also use on blogs and other social media. Share testimonials. A quote from a happy customer, existing investor, advisor or awarding bodies/judges is a powerful way to bring your business appeal to life. Collect your testimonials in written and video forms, if possible, to maximise their use in all your communication. Set up your funding communication strategy or marketing plan. An already-established community, whether personal or business, is incredibly helpful and can assist you in sharing your message, as well as investing themselves. Aside from the community, spend time researching where else you can spread your message. Some actions that could work well: Direct marketing: Create a mailing list with everyone who might be interested in supporting you. You want to use this list for two things: raising capital and expanding your network. Email marketing: If you have a mailing list with potential investors on it, them an email to introduce your business and make them aware of your fundraise on your chosen platform. To be as effective as possible, try to network to obtain the business emails of people who might be serious prospects and to follow up with calls, aiming to set up a meeting for a final discussion. If you have your own public relations (PR) representation or press contacts, use them to communicate your crowdfunding campaign. Also take advantage of any PR opportunities and additional support offered by your chosen platform. Expand your network. Many people will like your business idea, but for various reasons only few will actually invest. However, you can still benefit from their networks. Ask investors you are talking to if they know two or three other potential investors who might be interested in your business. Attend and host events. Attending and hosting events are great ways to put you in direct contact with potential sophisticated investors, and enable you to practise your pitch. Attend as many suitable events as you can in your area, and further afield, and if possible, create some of your own events, as well as attend any of the investor facing events organised by your platform. Make use of social media. Use your Facebook and Twitter accounts to transform your supporters into investors by making them aware of your fundraise and updating them regularly. Remember, every post should include an appealing picture. Encourage friends to share your posts and tweets with their network, and work that hashtag. Share your social media handles with your platform, so they can mention them too. Make your LinkedIn network aware of your campaign, too. Also consider contacting LinkedIn groups to spread the word. With most groups having over 1,000 members and the majority of them getting a group update email this method can get you into thousands of inboxes around the world. Tap into a network of influential people. This can work incredibly well to create momentum for your campaign. Think of the most influential people you know or know of in your industry, and use social media to raise awareness of your campaign with them. Hopefully, they like what they see and will mention it, or who knows, they might even invest. Blog about your fundraise. Post informative updates about your business's developments so you can stay in touch with your crowd throughout the funding campaign. Include things like funding progress, hitting business milestones, taking on new partners, securing a new contract and so on. Use all social media outlets to drive traffic to your blog or any other on line interaction you've set up.