Around the Web: A Week in Summary
A recent article from BizBuySell entitled “How to Find an Investor for Your Small Business by Thinking Outside the Box” explores some unconventional or less frequently thought of ways to find a small business investor. Typical routes of asking friends or family or other personal loan options are always possibilities, however the following list includes some alternative funding options:
- Assistance from the Small Business Administration
- Incubators or accelerators
- Online lending clubs
- Smaller, more specialized social media platforms aside from Facebook or LinkedIn
These methods, however, aren’t sure-bets for everybody. Like any investor, investors from the aforementioned channels will likely need to see a proven business model, a thorough business plan, and an exit strategy, among many other things.
A recent article posted on the Axial Forum entitled “3 Reasons M&A Statistics Are Suspect” explains a few reasons why some M&A industry statistics may not paint a full, accurate picture of the industry. Shocking statistics report low deal closing rates, for example, but the typical emotional preparedness and poor financial justifications for these numbers may not be the root cause. Find three alternative reasons why M&A statistics may be suspect below:
- The data used is based on a poor sample
- Everyone transitions and transacts
- The 70-90% of business owners who don’t use advisors are never included in the statistics
It is important to recognize that while statistics are often good for reference, they may not always be fully accurate or dependable as facts. There will often be some sort of discrepancy or bias, which is good reason to stay alert and never be fully dependent on industry statistics.
A recent article posted on Divestopedia.com entitled “4 Ways to Unlock Cash in Working Capital” describes some ways in which a company can free up some cash within their business for both reinvestment and paying down debt, but also to increase business value for a potential sale sometime down the road. Tips for unlocking cash in working capital are:
- Be Disciplined When Granting Credit
- Turn Work Into Invoices
- Turn Invoices Into Cash
- Manage Payables
As mentioned previously, freeing up cash can do wonders for business valuation: potential buyers want to see cash on your balance sheet. The more cash, the better a business is viewed in the marketplace.