| For many years, companies have relied on venture | | | | of your company to someone else. They will want a |
| capital financing to grow and expand their businesses. | | | | say on how things are done. Many times this is good, |
| Recently, most venture funds have been reduced in | | | | since venture capitalists usually have seasoned |
| scope and size to deal with the current economic | | | | executives that can help you. However, it will take |
| environment. Unfortunately, this has had a substantial | | | | some of your independence away. |
| effect in the broader economy by limiting | | | | There are two alternatives that can help you, |
| entrepreneurship and innovation - key component of | | | | depending on your situation and line of business. One |
| economic success. | | | | if factoring financing. Factoring bridges the 30 to 60 |
| Without venture capital, many business owners try | | | | day gap between invoicing a commercial customer |
| to finance their companies by looking for a business | | | | and actually receiving a payment. This advance |
| loan from a lending institution. However, business | | | | payment enhances your cash flow, providing you |
| loans are only given to companies that have strong | | | | with funds to pay current expenses and grow the |
| collateral and can show profitable operations. | | | | business. The other alternative is to use purchase |
| Companies will also need to provide financial | | | | order financing. PO Financing only helps product |
| statements that will be rigorously reviewed to ensure | | | | resellers who have a large order and don't have the |
| that they meet institutional criteria. Because of this, | | | | funds to buy the product from their supplier. In both |
| this type of business financing is out of the reach of | | | | factoring and purchase order financing, the |
| many business owners, especially at this time. | | | | transaction is settled once the customer pays the |
| There is are alternative ways to finance your | | | | invoice. And as opposed to other types of financing, |
| company. They can help you expand your company | | | | the most important collateral if your customers credit |
| organically without generating any new debt. And | | | | rating. Thus, you can leverage your clients credit |
| more importantly, without having to give any equity | | | | rating to fund operation expenses and growth. This |
| in the business to someone else. Remember that | | | | makes factoring and purchase order financing an ideal |
| when you use venture funding, you are selling a piece | | | | solution for many businesses. |