Now, this need not be told how important is finance for any business activity. Finance is like Lifeblood without it Business it and when it is less than required (Liquidity Problem) your venture will fall seek and if not treated it will expire in due course, Leaving you lots of pain and Loan to be paid.
Ok, Let s Come to the point- For a new business the biggest challenge is to arrange required finance to set up.
Now let’s understand different sources of finance and the pros & cons of that source.
Generally, sources of Finance are analyzed on a four-point basis (3CR concept):
Cost: Cost of a Capital, That includes the cost of raising that fund and interest payment.
Control: Control says how a source of finance impacts control or ownership of a business.
Complexity: It refers to how complex or time consuming is to raise a fund from those particular sources.
Risk: It reflects the risk of becoming bankrupt due to the Interest payment burden.
Mode of Financing a new business:
| Mode of Finance | Cost | Control | Complexity | Risk |
| Promoters Contribution | Low | High | Low | Low |
| Project Finance | Medium | High | Medium | Medium |
| Bank Loan | High | High | Medium | Medium |
| Govt Sponsored Loans | Low | High | High | Low |
| Venture Capital | Low | Medium | Medium | Medium |
| SME Primary Market | Low | High | Medium | Low |
| Primary market | Medium | Low | High | Low |
Now, this is the Million Dollar Question. Being a new business it is difficult to get finance as generally financer shy away from financing a new venture due to lack of track records. Bank don’t stand to finance it without proper how to get Finance for new Business?
Collateral (Which is generally not available to new promoters). Venture capital is not ready till they are not convinced with your Idea and financial data.
Yes, Lot s of Problem!
AKT Associates can help new business ventures in such situations. With Expertise in Business finance and Experience in Project finance, we can help you get finance for your venture. Only Condition Idea should worth finance.
If you trust your Idea then, Trust AKT Associates we can guide you to success.
The real issue?
With our experience we have seen in most of the rejected projects the problem is not the Idea or its viability but its presentation.
We ensure that the Presentation of data remains realistic and within practical boundaries, Which help Promoter not only impress the financer but also convince to finance.