Ten Ways Start-ups Use Venture Leases And Loans To Generate Millions – Mortgage
Ten Ways Start-ups Use Venture Leases And Loans To Generate Millions
George A. Parker
The rise of venture leasing and lending has created an opportunity for sophisticated entrepreneurs to gain a competitive advantage. Savvy entrepreneurs are using venture leases and loans to generate millions of dollars for shareholders by leveraging existing venture capital. They have discovered ways to use this flexible financing as a tool to build enterprise value between equity rounds and to leapfrog less sophisticated competitors.
Venture leases and loans are usually asset-based, financing arrangements. These financings are available to qualified pre-profit, early-stage companies funded by venture capital investors. Start-ups need equipment and working capital to help them execute their business plans and to reach profitability. Venture lenders and lessors provide financing to these firms to help them acquire computers, lab and test equipment, production equipment, phone systems and other needed business equipment. These specialty financing firms may also provide financing for working capital in the form of accounts receivable and/or inventory loans. Start-ups that qualify usually have promising business prospects, well-defined business plans and have raised more than $ 5 million in venture capital from reputable venture capitalists.
How are these savvy entrepreneurs using venture leases and loans to boost shareholder value and to gain an edge on the competition Here are some of the ways:
To stretch equity capital and to increase shareholder value between equity rounds. By using venture leases and loans, entrepreneurs can forestall going out for more equity while they continue to build and increase the value of their companies.
Use of loans and leases instead of internal cash helps to stem negative cash flow. Most start-ups are faced with negative cash flow until revenues build sufficiently to cover costs. Using limited internal cash for equipment purchases, to invest in inventory or for accounts receivable is not wise, if there are better options.
To protect working capital. Purchases of intermediate-term assets with internal cash will remove those funds from working capital. Use of venture leases and loans helps to keep the pressure off of working capital as the cost of these assets gets spread over an extended period.
To supplement other capital sources. Venture leases and loans supplement equity capital, mortgage financing and other financing available to start-ups.
To liberate cash from equipment, accounts receivable and inventory already financed internally. By doing a sale-leaseback, the start-up can liberate cash from equipment already owned. Likewise, the start-up can finance inventory and accounts receivable that have been funded internally by using a venture loan.
To bridge-finance equity transactions. Occasionally, start-ups are able to obtain short-term loans to bridge upcoming equity transactions. These loans are usually well secured by all-asset liens against these companies and are generally available for short time frames. Most venture lenders who provide this type of financing require equity kickers in the form of warrants to purchase stock in the start-ups or stock issued directly to them by the start-ups.
To hedge against rapidly depreciating equipment. Venture leases can be structured as fair-market-value leases. These leases usually allow the lessees to renew the leases at fair-market-value renewal rates, to purchase the equipment at fair-market-value purchase prices, or to return the equipment to the lessors at the end of the leases. The return option allows the start-ups to conveniently dispose of obsolete or unneeded equipment.
To replace venture capital. Start-ups are using loans in the form of subordinate debt as a substitute for additional equity rounds. These loans can be collateralized or unsecured and can be used for many of the same purposes as equity funding
Niche Marketing: Tactics to Use To Make Money With Niche Marketing – Domain Name
Niche Marketing: Tactics to Use To Make Money With Niche Marketing
Karl Augustine
Niche marketing has always been a key any success in marketing but lately it has become quite a prominent force in the online marketing world. Many books, manuals, courses, and web sites have been developed that focus on niche marketing. It is easy to find solid resources on the Internet that can teach you how to make money with niche marketing.
Niche marketing online is a distinct segment of Internet marketing and is the quickest way to get maximum exposure if you know how to leverage the search engines to draw attention to your niche web site.
Theres many things to learn to be successful and profit from niche marketing and your USP Unique Selling Proposition will dictate exactly how to plan your attack to successfully market to customers in your niche.
If you plan to use niche marketing to draw visitors to your web site, heres a few tactics that you can use to make money:
Niche Marketing Tactic #1, "Research"
Fully utilize all of the research mechanisms that you can find in order to make sure that you truly understand your niche and all of its nuances.
This requires understanding what tools are best to use so you can understand what your target niche market does day to day, where they spend their time online, and what makes them tick from a personal and business perspective.
Niche Market Research http://www.nichemarketresearch.comoffers free reports and articles to help you make the most of your research time.
Niche Marketing Tactic #2, "Define your paying niche"
Clearly define who will make up your niche market and make sure that the people in that niche market are willing to pay for the solution that you provide to their problems.
A niche is a clear subset of a larger category.
An example of what a niche market is not: "People who want to learn how to shoot better scores in golf."
In this example, there are far too many people within the main category golf to make this a true niche. Virtually everyone who plays golf will want to play better and shoot better scores so this wouldnt qualify as a niche, much less a category worth pursuing.
An example of a niche market: "Women who play golf who want to learn how to drive the ball longer and straighter."
This would be a niche because it clearly defines and segments who youll cater to and why they would need your service.
After clearly defining your niche market, you should make sure that they are willing to pay for your services. The easiest way to determine this in the online world other than using common sense is to find web sites that may be close to, or even in your niche, and see if those web sites charge a fee for their services.
In addition, you should look to see if there is a reasonable level of competition between those web sites.
If you see more than a few sites listed on a SERP Search Engine Result Page that cater to female golfers for a fee, chances are the people who are your target customer will pay for your services for solving their problem - women who cant consistently hit long straight drives in golf.
Niche Marketing Strategy #3, "Choosing keywords and domain names"
Research and choose your keywords carefully so you can acquire the best domain name for your site. Niche marketing most often includes maximizing the way search engines work to make sure that your web site gets listed n the first page of the SERPs from your chosen keywords. Your domain name contributes to getting those first page results.
Go to Digitalpoints keyword suggestion tool and type in keywords that you feel people would use to find the product or service that you offer within your niche. Look at the number of searches performed per day for those keywords and review the other keywords listed.
http://www.digitalpoint.com/tools/suggestion/
Type the keyword phrase that you think best suits your USPs target customer into Google and assess whether or not you can reasonably compete with the sites that are listed on page 1 of the SERPs.
Can you get a page 1 ranking knowing that youll have to compete with the sites already listed
Repeat the process until you have decided what your main keywords will be for your product or service within your niche.
Those keywords should be in your domain name and preferably, they should be your entire domain name.
Example: if youve concluded that blue widgets best suits your USP and you feel that you can compete for page 1 listings on the SERPs with the sites that come up on page 1 for the keyword blue widgets, then a good domain name for your niche marketing site would be bluewidgets.com.
Niche Marketing Tactic #4, "Posting keyword rich articles or reports throughout the web"
Niche marketing doesnt differ from any other online search engine marketing, posting relevant content is the best way bar none to get the right type of traffic to your niche site.
Writing keyword rich articles or reports and posting them to high traffic web sites is a great way to make sure that you get maximum exposure within your niche market. People will use your keywords to search for information about the topic that they have interest in, and they will come across your web site on the search engines results.
Niche marketing caters to a distinct and select group of people who need what you have to offer. If you define your niche properly and make sure that your ability to solve their problem is something that they will pay for, you will have established a "money maker".
Utilize the search engines to make it easy for your niche market to find your service or product. Niche marketing is the easiest way to be successful on the Internet if you do the proper research.
About The Author
Karl Augustine -Publisher, "Starting Smart!"
*Learn SEO - Top 10 listings
http://www.9mistakes-online.com/nichemarketing.htm