Don’t be Afraid of Private Equity
Small business owners may be intimidated by private equity and think it’s overly complicated. Many entrepreneurs think that small business private equity investment only consists of buyouts or mergers and acquisitions. And some still have a misconception that private equity is only for start-ups, the tech industry or larger companies.
In reality, private equity is actually one of the best options available to small businesses for raising capital and fueling growth. However, many businesses look first to traditional bank loans or credit cards to finance things like expanding operations or increasing production. According to research by the Women’s Business Enterprise National Council, women are less likely to seek financing for their business than men; and when they do, more use credit cards.
In the past, it may have been tough for small companies to take advantage of private equity, but times have changed. Those that don’t consider it as a financing option stand to miss out in more than one way.
Your Success is Their Main Goal
Small business investors are generally not much different than small business owners. They are business people that want to succeed. They want to increase the value of their investments, drive innovation and create sustainable growth. How they achieve those goals is different for each business they invest in. They will consider every aspect of a business using their extensive expertise and industry knowledge to optimize their approach.
More Than Just Money
Small business investors offer more than just financial capital. They also contribute their intellectual capital, providing entrepreneurs and business owners with valuable insight, expert guidance and new perspectives. Another overlooked benefit of working with small business investors is their wealth of business networking connections. From making improvements to the supply chain to negotiating deals with new vendors, investors may sometimes be the missing link between business owners and key industry partners.
Small business investors can help facilitate relationships and develop effective strategies to fuel growth and generate momentum. An investor can be as involved as you want them to be. They will be there to help you work through challenging and demanding times and they will be there to help you celebrate and build on your achievements. They can also serve as a neutral sounding board and help you avoid common business pitfalls.
Leadership and Mentoring
Could you use a little help capitalizing on growth opportunities or managing a business expansion? Are you a woman-owned small business looking at financing options? Perhaps you are retiring soon and want to figure out how to set up your business succession? Or maybe you’d like to revise your business plan with a new vision and goals.
Leadership and mentoring are another hidden benefit of working with small business investors, and it’s more than just advice. It is expert, hands-on guidance backed by years of experience and a track record of helping businesses prosper and grow.
Private equity partners are also impartial. Unlike some advice from biased parties, small business investors are focused solely on making sure that your business succeeds. They will be candid but supportive and will help you stay positive, motivated, and focused on finding solutions. In addition to all that, they are also extremely committed to you.
Don’t Overlook Private Equity
Small business investors are one of the most effective and often underutilized financing options for small businesses. In addition to being a source of capital, they also drive growth and create value in strategic ways. While private equity financing may not be the right choice for everyone, small business owners should not overlook the many hidden benefits they offer.
It’s important to find a partner that is aligned with your business goals and your vision for the future, but if long-term success is ultimately what you want, it is well worth the time and effort. Whether your focus is on securing funding, building a network of business connections or growing your business through expansions or new product offerings, small business investors can play a key role in the long-term success of your business and help you prepare for the future.
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