4.4

loans through personal collateral

can replace short-term bank loans

No time limit for having a stake in a start-up.

A VC investor doesn't assume business risk he is also not committed to the success of the business;

a specialised institution (‘factor’) buys accounts receivable from a firm (‘seller’) and pays for them in two parts:

Designed by the Government to help entrepreneurs who have problems in obtaining capital from traditional sources.

Around how many months do you need to do Crowfunding based on rewarding

Which of these sources of financing for a startup have a Medium Risk/Return and are considerered Hybrid Instruments

venture capitalists invest in a startup, they provide funding in exchange for an ownership stake in the company. Low v.

Business Angels are used as seed capital.

the customers who order should be creditworthy

Order the bank to charge our account and pay to another account of a third party. Safe, fast & cheap. NOT immediate.

Interested in any start-up which shows a high potential of growth and projects extraordinary returns.

Asset-based lending is attractive for manufacturers or others w stock inventory

Refers to the process of selling or disposing of the venture capitalist's ownership stake in a company. (High Value)

The goal is to obtain debt with a lower cost (at a prime rate)

a transaction with assets as a primary source of repayment

Interested in a start-up which activity is closely related to its main business.

A VC investor also offers contacts to potential customers, providers and partners;

complying with the legal, accounting and administrati ve requirements, start of the transition period

Traditional bank loans and credits: short-term

Traditional bank loans and credits: long-term

secured assets:

An online payment system that allows you to accept payment from customers by credit/debit card.

Which of these sources of financing for a startup have a High Risk/Return

Official Loan Guarantee Programmes aren't regulated by law.

Equity is any form of wealth employed to produce more wealth.

It is not about collecting as much as possible but about covering the specific financing needs detected previously

Loans with a preset limit

a common bootstrap mechanism to finance use and purchase of expensive assets;

In which sectors do Business Angels invest?

Physical document for immediate collection. It implies management with the bank and waiting 2/3 days to get the money

ICO, CDTI, ENISA in Spain & Sodercan in Cantabria (loans & subsidies) are examples of …

Based on LOANS: CROWDLENDING

A VC investor provides additional expertise in various areas: strategy, human resources management and so on

Debt doesn't allow the company’s owners to maintain their ownership.

a supplier short-term financing mechanism;

Private organizations that accumulate capital to purchase equity positions in young businesses with potential to grow.

For an Industrial VC investor, investment is seen as a strategic alliance.

sending of the business plan, analysis and evaluation of the startup company by the investor

short-term loans, intermediate- and long-term loans

Using Personal Savings to finance a start up is also a threat of undercapitalization

Its goal is to receive profits and divest on “a fixed date”.

Stages: (1) Preparation of the operation, Should be run entirely by the entrepreneur

loans to withdraw up to the limit established by the bank

the most economic source of financing. (Equity)

Financial payment management service: the creditor can anticipate and transfer the risk to the issuing bank.

Physical document of future payment order with legal guarantees. It can be discounted.

Accelerators are very effective to attract investors for further development

Physical document with postdated payment date. At maturity = check. Can be discounted.

Trade credit is an extension of traditional credit and credit mitigation tools

Crowdfunding based on shares: CROWDEQUITY

Crowdfunding based on Rewarding means

It is mandatory to present financial solvency and a business plan that shows that there is an expected profitability

For a financial vc investor Complying with a business plan is the must.

smaller banks are more flexible regarding payments terms

Asset Based Finance (Low risk/return)

What platforms of CROWDLENDING are popular in SPAIN?

FACTORING: the factor collects the money from the firm’s customers at the due date of the invoices.

Instruction to the bank to debit the customer's account. There is a deadline for repayment.

list of investors to contact to, documentation with a brief description of the opportunity, declarations of interests

VC investors are interested in any potential profitable business opportunity

What CROWFUNDING platforms are popular in SPAIN?

Crowfuding (debt) is an alternative debt of low risk/return

The additional equity through VC improves the start-up’s borrowing capacity

negotiation of the agreement; completion of the due diligence

loans as basic unsecured

may be backed by an irrevocable letter of credit from a reliable bank

Capital’s different forms in a business

Stages of investment in a start-up

Gofundme, Kickstarter and Indiegogo are examples of

Factoring and Leasing are asset-based finance

Microcredits aimed at two types

 the past records and performance of a company are important for

Angel In play a huge role in the economy, and in many countries are the largest source of external funding, after family

a working capital advance to cover part of the production of a good or service demanded by one or +1 specified customer

Venture Capital (VC) Include Business Angels as private investors.

Business angels provide financing but not manangerial experience

an anticipated collection of invoices or trade effects

Venture capital investors can't be financial partners

(Equity) potential investors. Apparently easier to negotiate with.

their contribution is donation and not investment

wealthy individuals who invest in start-ups in exchange for equity stakes in the company.

Stages of investment in a start-up: the main financial statements,business plan,entrepreneu assess the value of the firm

VC investor as a shareholder isn't seen as positive. It is not a constitution of a stable shareholding of a start-up

personal investment of the founders called risk capital, no scheduled repay the shareholders keep control over business

Fund raising is a time consuming task and an ongoing process.

A financial advantage of VC is they do not ask for collaterals;

Intensive business and personal development programmes (structured)

the VC leaders worldwide: Keiretsu Forum and New Enterprise Associates.

Leasing helps to reduce the long-term capital requirements of their businesses and improve their cash flow

mintos, envestio, bondora are examples of

secured assets: accounts receivable, inventory, equipment and real estate

sectors with more VC investment

Financing that an entrepreneur borrows and must repay with interest.

A lease is an agreement whereby the owner of an asset (lessor) provides a customer (lessee) with the right to…

Finnish yoga platform Yoogaia successfully closed their crowdfunding round via FundedByMe at €100K is an example of

Payment/collection service provider for parties to an e-commerce transaction.

Difficulties to finance a startup

Business Angels usually provide smaller amounts of finance (EUR 25.000 to EUR 500.000) at an earlier stage.