Business, Investment, and Charity

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StrategyDriven Managing Your Finances Article | Business, Investment, and CharityThe joy of any business is the Return on Investments (ROI). Also, the money you will accrue from the investment can go far in doing great charity in society today. However, before starting a business or investing, you might want to ask yourself how viable the business or investment is. That is when you should start thinking about a community-oriented charitable project. Therefore, if you are lucky enough to meet someone like Fred Baerenz, you might not want to miss the chance to pick his brain on how he seamlessly gel business, investment, and charity. By the end of the conversation, you may be an idea away from being wealthy as you desire.

What should you look for in a business investment? 

Business and investment are not easy, but you will be smiling your way to the bank once you do it right. It is practical to know that you will not always get it right as desired, but the journey is worth the cost. Before considering a business investment, there are many factors to consider. The world of business is dynamic and tying it with investment makes it even more dynamic. However, with the right team and tools of the trade, you will scale high in business as an investment. The research on the market will be a good place to start. The opportunity and niche presented should be sustainable enough at last for your capital.

Charity investment

Business flourishment will bring activities such as Corporate Social Responsibility (CSR). Everyone has responsibility around the community of their establishment, if not the world. Considering activities such as children’s funds and supporting climate change are just a few of the CSR charity investments one might consider. Building a sustainable CSR goes hand in hand with building the business. Charity investment comes with its share of challenges and benefits.

In conclusion, the desire to build wealth is admirable and takes too much patience and strategy. Either through business or investment, success is a journey that takes resilience. The moment you will find yourself in magazines such as Forbes and your name all over Wall Street, you might want to consider joining AOG Wealth Management to secure your future. The billionaires club has its privileges but maintaining the status is what matters. Therefore, learning how to stay on top of your business, investment, and charity is important in any cooperate world.

Bookkeeping Tips For Entrepreneurs

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StrategyDriven Managing Your Finances Article |Bookkeeping Tips|Bookkeeping Tips For EntrepreneursBadly managed and improperly handled finances can cause a lot of serious issues for any business, from poor cash flow to legal action from tax mistakes. These problems can put a new business at serious risk. Good bookkeeping and accounting habits can help an entrepreneur to do well. Learn these important habits to help your business to succeed.

Get Professional Help To Prepare Tax Returns

Business owners have a lot of different tasks to juggle and a lot to do. This is why it’s a good idea to outsource any work that you don’t have the skills or time to do by yourself. If you’re like a lot of entrepreneurs, you’re probably not a trained accountant and don’t have the time to become a certified bookkeeper.

Outsourcing the job or using virtual bookkeeping services gives the task to somebody who can do it faster and more accurately, which is a better plan than struggling with it alone.

A professional accountant can do a lot more for you than just sort out your tax return. Someone with a skilled financial eye can see ways to improve your accounting processes too.

Don’t Go Entirely Hands Off

Outsourcing your bookkeeping doesn’t mean you should hand it over completely to someone else. You still need to look at your reports, understand what’s happening with your finances, and ask questions when you don’t understand anything.

No matter your own level of bookkeeping knowledge, it’s a good idea to have some understanding of basic numbers yourself, such as your profit, trend in expenses, accounts receivable, profit per customer, and how your client funnel works.

Get The Right Software

You shouldn’t choose an accounting program just because it’s the cheapest option. There’s a lot of choice for software available, so businesses don’t have to use accounting software that is only designed for accountants.

There are plenty of choices available, so look for software that will meet the needs of your business. If you’re not a trained accountant, then don’t choose a system that will need a huge manual to get you started.

Document Your Processes

It can help to write documents that explain how your bookkeeping processes should be managed. By documenting all these processes you can prevent any confusion and answer any questions that people might have.

Consistency is essential for good bookkeeping and can help you to spot issues as you will have a better notion of what might have gone wrong.

Keep Expense Receipts

You can’t keep track of how much your business is spending if you don’t keep your receipts organized. This is easy to do for credit card purchases, as you will have your receipts and your monthly statements to check the receipts against.

Cash expenses can be more difficult to track. The receipts from cash purchases are important as there are no backup statements to double-check. Try keeping a small notebook to log cash expenses. You could do this in an accounting app in your phone, and take pictures of the receipts as you go.

How to source funds to expand your business

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StrategyDriven Managing Your Finances Article |Funds to expand your business|How to source funds to expand your businessAs a small or medium enterprise business owner, you are probably always looking for growth opportunities. To realize such opportunities, you need a lot of money, and often you may not have that much to help you realize your dreams. You will need to source funds from other sources to make the most of the opportunities that come your way. But sometimes, due to the lack of financial literacy or good financial advice, you may end up making the wrong choice. For instance, you need to know the difference between grant & loan to know which one best suits your needs. Here are some options that you may consider when sourcing funds to expand your business.

Bank loans

Bank loans remain the most common option for most businesses looking to expand. Bank loans provide medium to long-term finance for your business. You will need to provide some documentation about your business, a plan, and collateral to acquire one. To be safe, get a financial advisor to help you understand the loan terms before deciding to go in for it.

SBA-backed loans

Only available in the United States, The Small Business Association offers small businesses various loans via participatory banks all over the country. SBA-backed loans are set up to help small businesses secure funding to grow their company specifically. Mind you, though, the SBA itself is not responsible for the loan. You will need to have a good working relationship with the loan officer at your local bank to gain access to such loans. You could also find the nearest Small Business Development Center SBDC and register to access their small business loans.

Venture capitalists

Venture capitalists are people who choose to invest in businesses to help them start-up or expand. Venture capitalists are looking to make a good return on their investment and, as such, may get involved in running the business or offer their expertise. Due to the huge amounts that venture capitalists look to invest in a business, you must have a solid business plan and serious projections for the future for you to be considered. The basic sums venture capitalists invest are from $500,000 to $10 million, so you must have a high growth strategy to entice them to listen to your pitch.

Angel investors

Much like venture capitalists, angel investors are looking to invest in businesses and see them succeed. The significant difference here is that instead of looking out for returns, angel investors rather want to transform their investment into the equity of your business. But they may not invest as much as venture capitalists. To seriously consider angel investors, you must first have an exit strategy for your business and solid projections for the future. If you aim to hold onto your business, then angel investment may not be for you. The goal is to gain equity, help the company grow and then sell it or when it goes very well, do an IPO.

Crowdfunding

This type of source funding has seen quite a hike as there have been many success stories. It is pretty straightforward; you ask people to donate a sum of money for a particular project to exchange diverse rewards. These rewards are generally categorized into equity, debt, and donation. However, to participate in crowdfunding, you need to know the rules and requirements of the sites and carefully review your options before you proceed.

Small Business Bankruptcy – The Next Steps

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StrategyDriven Managing Your Finances Article |Small Business Bankruptcy|Small Business Bankruptcy – The Next StepsBankruptcy might be your best shot at eliminating debts and restructuring your finances. 2020 brought with it an economic disaster on a scale not seen since the Great Depression. Forbes predicts bankruptcies this year will increase by over 140%, and these bankruptcies will affect small businesses the most.

Bankruptcy Options For Small Businesses

Depending on what kind of business you own, its income, and your relationship to it, there are potentially three types of bankruptcy available to you. We will break down chapter 7, chapter 11, and chapter 13 in detail so you can decide what bankruptcy option is right for you.

Chapter 7

This option is best if you are a general partner or sole proprietor of a business. Chapter 7 can eliminate all debts for which you are personally responsible. You can file for certain exemptions that may make it possible for your small business to continue operating.

What Exemptions Can Keep Your Business in Operation?

Your chapter 7 trustee cannot sell off exempted assets, but what counts as a potential exemption varies state by state. So, depending on where and how you operate your business, it may continue despite the bankruptcy.

Some state exemptions allow debtors to exempt “tools of the trade,” which can cover items essential to certain types of businesses up to a certain price. Another exemption that may be available to you is a “wildcard” exemption. These protect any asset of the debtor’s choice.

Chapter 7 For LLCs and Corporations?

If you are an LLC or corporation, chapter 7 can only really help you liquidate your business. Unlike chapter 11, there is no way to keep your business operating under chapter 7. All of your business’ assets will be liquidated.

Chapter 11

Chapter 11 bankruptcy is the stereotypical type of bankruptcy you hear about in the news. When giant corporations claim bankruptcy, this is usually the kind they file. However, the majority of chapter 11 bankruptcies are filed by small and medium-sized businesses.

Under chapter 11, business entities like LLCs and corporations can restructure their debt by selling some assets. This option allows businesses to remain in operation, usually at a reduced scale.

Special Provisions for Small Businesses

Chapter 11 bankruptcy is a time-consuming and expensive process. Usually, larger businesses can handle the costs, but smaller companies may have trouble with the legal fees and restructuring costs.

The CARES Act and Small Business Bankruptcy

Since the CARES Act increased the debt ceiling for small business bankruptcies in 2021, the bankruptcy code considers a small business as an individual or entity that owes no more than $7,500,000 of business-related debts. This amount will hold until the provision is set to expire in March 2022. Previously, the debt ceiling was only $2,725,625.

The Creditor’s Committee Can Be Waived

The creditor’s committee is formed to protect the interests of the creditors, and it is formed and retained at the debtor’s expense. This includes fees for attorneys, experts, and other legal professionals. Creditor’s committees are usually very expensive to maintain. A designated small business debtor can petition to waive the creditor’s committee from the bankruptcy process.

More Oversight, Deadlines, and Reporting for Small Business Debtors

Small business debtors are subject to stricter guidelines, increased oversight, and more rigorous enforcement of deadlines for meeting all of the steps in the bankruptcy process.

Chapter 13

This bankruptcy option is only meant for individuals, but by default, becomes available to individuals who are also sole proprietors. LLCs or corporations are not eligible for chapter 13. This option is typically harder to file for because it allows the debtor to keep most of their assets and creates a payment plan for the debtor to pay off some of their debt.

This means that as the sole proprietor of a business, you have three to five years to pay back some or all of the debts in monthly installments. You can select workspace and equipment as some of your exemptions and, technically, through chapter 13, you can keep your business in operation.

What Option Is Right For Your Business?

Declaring bankruptcy is a massive step toward debt relief. By knowing your options, you can make an educated decision and select the chapter that is best for you and your business interests.

About the Author

StrategyDriven Expert Contributor |Veronica BaxterVeronica Baxter is a writer, blogger, and legal assistant operating out of the greater Philadelphia area. She writes extensively for the Law Offices of David Offen, a bankruptcy attorney in Philadelphia.

Gain The Funding You Need To Grow Your Business

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StrategyDriven Managing Your Finances Article |Funding|Gain The Funding You Need To Grow Your BusinessAre you thinking about growing your business? Growing your business is important and it’s one of the measures of a company to determine whether it is successful. If your business remains stagnant on the market for too long then the longevity of your model will almost certainly be called into question. However, growth does cost money. So, let’s look at some of the ways that you can fund a change like this in your business model.

Self Fund

First, you might want to think about self funding your business growth plan. This could be possible if you have enough money already in your personal accounts. Even if you don’t you might be able to free up some money. For instance, you could sell structured settlement damages that you claimed in a court case. This will provide you with a massive sum of money that you can then inject into your business. There is absolutely no limit on how you use annuity like this. If you want to fund your business with the cash, then you can.

Head To A Tradeshow

You could consider attending a tradeshow to gain the funding you need for your business. Attending a tradeshow will be useful because it means that you will be able to get the interest of investors. Unfortunately, attending a tradeshow is also massively expensive so it does require you to take on quite a lot of risk. You’ll have to spend about a year planning for this type of event and you need to think about ways to ensure that your business does stand out. However, even with these issues attending the right tradeshow can catapult your company to new heights.

Get A Loan

Next, you could think about using a loan to fund the growth of your business. If you are going to get a loan for a company, then you’ll need to ensure that your books are in order. It’s essential to guarantee that you are not in the red or taking on too much risk. Your credit rating can also impact your ability to get a loan for a private company. As such, you might need to improve your credit before you take this action and move forward with this possibility.

Other loan options include private equity and venture capital funding. However it is important to know what position is right for your business and what you qualify for. Taking on the wrong type of funding can go one of two ways so while both of these are viable options for funding you should research private equity vs venture capital funding to ensure you know exactly what you are getting into.

Crowdfunding

Of course, you could also look at crowdfunding options as well as a way to get the money that you need to grow your business. This could be a useful option if you are planning to sell a new product or service and you know that there’s already an audience interested in buying. Crowdfunding is a smart choice if you know how to build demand, get people excited and use viral media. However, it’s highly competitive these days and it’s difficult to breakout or get attention unless your company has a hook. There needs to be something unique that makes an audience connect.

As you can see, there are numerous paths that you can choose which will allow you to fund your business growth. It’s just about choosing the right one for your particular business model.