In Part I, we discussed those components that are found in great funding packages. We covered the key features of the Business Plan, Executive Summary, Proforma and the Resumes of Principals. We also discussed how to make them stronger and more compelling to investors. Today we will conclude our discussion on this topic by covering these remaining areas: 5. Breakdown of funds already invested in the project 6. Detailed use of funds 7. Comprehensive Exit Strategy 8. Relevant Intake Form V. Breakdown of funds already invested in the project Investors are always interested in seeing where your level of commitment stands. The most effective way of demonstrating this is in detailing how much of your ownmoney you’ve risked in the project. A word of caution here:Nothing will douse an investor’s enthusiasm for your project faster than finding out that you don’t have any skin in the game. Their thinking here is, “How great can this project really be if you’re not willing to risk your any of your own money?” Despite what some may think, investors are not guinea pigs. They are not interested in testing your ideas with their money. That is not how it works. Be as detailed as possible here. Explain the level of progress achieved so far with your initial investment. If there were setbacks, describe them and what you have done to overcome them. This builds trust in your leadership and further demonstrates how passionate and committed you are to the success of your project. Besides, shrewd investors will always ask you about this somewhere down the line. Rather than try to bury any missteps along the way, be honest and straightforward. VI. Detailed use of funds Investors want to know, down to the penny, what you plan on doing with their money. Present them with a detailed list of the following and, where necessary, tabulate the information in terms of weeks, months and years. Capital expenditures Property – land, building(s) Machinery and equipment Other fixed assets Non- Capital Expenses Pre-operational expenses – Studies, marketing, research, legal expenses etc. Production and related expenses Selling and distribution costs Administration and maintenance costs Such clarity and detail will be welcomed by your potential investors. To score additional points with them, look into the costs of business operations similar to yours. Then you can show how your operation improves upon that level of performance and efficiency. This will demonstrate to our funding partners that you have considered your competition’s role in your venture and are ready, willing and able to compete effectively against them. VII. Comprehensive Exit Strategy Having a strong exit strategy is paramount. It needs to be clear to your prospective investors that you not only have a way for them to come in, but also have a solid strategy to get them out. This could be anything from refinancing your project to a full scale Initial Public Offering (IPO). Bear in mind, however, that investors will look to see how viable your exit strategy really is. If yours isn’t rock-solid they won’t give your project another thought. A great way to demonstrate the viability of your exit strategy is by highlighting market demand for your product, service or solution. The stronger the demand, the more reasonable it will be in your potential investor’s mind that there is a profitable future for your venture. This will help potential investors feel more secure in your exit strategy. As the old saying goes, “money talks”; more so than usual when it comes to investors. So, the perfect way to establish confidence in your market demand is with pre-sales, pre-leases, contracts with deposits and the like. Showing prospective investors that you have clients that are already committed to buying your product, service or solution will convey to your potential funding partners, in a very powerful way, that you have something real to offer. VIII. Relevant Intake Form These are available on our online submission platform after you register. They serve to give our funding sources a quick snapshot of all of the key aspects of your project. Our funding sources use them to quickly determine whether they would be interested in taking a closer look at your deal. As noted earlier, the funding sources you will be approaching look at hundreds upon hundreds of projects every single day. So you can be sure they won’t read through your project package until they have first reviewed your Intake Form. And there you have it. We hope that this run through has made it clear in your mind how you need to put a project package together that will get investors as excited about your project as you are. For more information or support Before you complete your investor package, take time to also read Top 7 Ways to NOTGet Commercial Funding – Part 1 and Part 2. These will give you a clear sense of what investors expect from you and what turn-offs to avoid. Feel free to contact us if you need any help in putting together your investor package. Your success is our success and we are ready to help ensure yours any way we can. When you are ready to submit your funding package just click here to register it on our site. You will be able to submit all of your documents and prepare the relevant Intake Form. You will only be able to log into your account once we have activated it. So take time to follow all of the steps indicated very carefully. You’ll have access to live tech support by calling 646. 417. 5302. You can also check out our FAQs for more information on solving any issues you encounter.
Archive for December, 2009
Lauton U: How to Put Together a Funding Package That Will Get Investors Excited About Your Project – The Basics (Part II)
December 31st, 2009The Comeback of the Hedge Fund of Funds: London Based Hedge Fund of Funds and Investors Set the Record Straight
December 31st, 2009
London, July 7th, 2008 — Opalesque, the world’s largest subscription-based publisher covering the alternative investment industry, has just launched the seventh issue of its groundbreaking Roundtable Series: Opalesque U. K. Roundtable (download here: http://www. opalesque. com/index. php?act=static?=RoundtableUK)
Remember a couple of years ago various reports claimed funds of hedge funds were doomed because of the multi-strategy managers? The fund of funds didn’t look to good back then. This Opalesque UK Roundtable held June 5th 2008 in London offers some important updates on this discussion.
In addition, you will read:
l Which strategies work and are in demand since the credit crunch?
l Why this is not the time to go into passive investments
l For what strategies is the credit crunch actually a good environment, who is striving
l You hear a lot about that difficulty of valuing collateral – why this complaint is often without merit
l Vital points investors often overlook in discussing fees with hedge funds
l What UK based managers say about the FSA principles-based regulation
l What US investors often don’t understand about UK regulations
The Opalesque UK Roundtable was sponsored by Newedge Prime Brokerage Group (www. newedgegroup. com) and took place in their London office with the following participants:
l David Harding, Founder and CEO of Winton Capital Management
l Paul Dunning, CEO, Financial Risk Management Limited (FRM)
l Tim Haywood, CEO of Augustus Asset Managers Ltd. (formerly known as Julius Baer Investments Ltd. )
l Stephen Oxley, Managing Director PAAMCO Europe (Pacific Alternative Asset Management Company)
l Joe Leitch, Co-Founder and COO of Rubicon Fund Management
l Karsten Schröder, Founding Partner and CEO of Amplitude Capital
l Gerard Gardner, Partner, North Asset Management
l Alistair (Ali) Lumsden, Portfolio Manager, CQS Management
l Mark Salem, Managing Director of Mount Capital
l Duncan Crawford, Head of Capital Introductions, Newedge Prime Brokerage Group
l Philippe Teilhard de Chardin, Global Head of Prime Brokerage, Newedge Group
The Opalesque U. K. Roundtable Script can be downloaded here: http://www. opalesque. com/index. php?act=static?=RoundtableUK
All other previously published Opalesque Roundtable Scripts (New Zealand (March 17th), Australia (March 25th), Singapore Roundtable (April 24th), Hong Kong (May 1st), Japan (May 23rd), New York (June 11th) can be downloaded here: http://www. opalesque. com/index. php?act=archiveRT
Matthias Knab, Director of Opalesque Ltd, moderates the Opalesque Roundtables. Matthias Knab is an internationally recognized expert on hedge funds and alternatives and has frequently served as chairman of hedge fund conferences in New York, Tokyo, Shanghai, Hong Kong, Miami, Bahamas, Stockholm, Dubai etc. In addition, he has presented or moderated at hedge fund events in Sydney, Cape Town, Madrid, and Bombay, and lectured at numerous universities on the subjects of hedge funds and the state of the global alternative asset management industry.
About Opalesque:
Opalesque leads the finance media space for its in-depth and innovative products. Since February 2003, Opalesque is publishing Alternative Market Briefing, the premium news service on hedge funds and alternatives. The launch of these Briefings was a revolution in the hedge fund media space (”Opalesque changed the world by bringing transparency where there was opacity and by delivering an accurate professional reporting service. ” – Nigel Blanchard, Culross) combining proprietary news with the “clipping service” approach of integrating third party news. Each week, Opalesque publications are read by more than 400,000 industry professionals in over 100 countries.
Opalesque is the only daily hedge fund publisher which is actually read by the elite managers themselves (http://www. opalesque. com/op_testimonials. html). For more information, please go to http://www. opalesque. com.
About Opalesque publications:
Alternative Market Briefing:
A daily newsletter on the global hedge fund industry, highly praised for its completeness and timely delivery of the most important daily news for professionals dealing with hedge funds. Alternative Market Briefing offers both a quick overview and in-depth coverage. Subscribers can also access the industry’s largest news archive ( 27,000+ articles ) on hedge funds and related topics.
A SQUARE:
Opalesque A SQUARE = Alternative Alternatives is the first web publication, globally, that is dedicated exclusively to alternative investments. A SQUARE’s weekly selection feature unique investment opportunities that bear virtually no correlation to the main stream hedge fund strategies and/or distinguish themselves by virtue of their “alternative” motive – social, behavioural, natural resources, sustainable /environment related investing.
With its “research that reveals” approach, fast facts and investment oriented analysis, A SQUARE offers diversification and complementary ideas for: private, high net-worth and institutional investors, pension funds and endowments, portfolio and hedge funds managers. Technical Research Briefing:
Delivers three times a week a global perspective/overview on all major markets, including Equity Indices, Fixed Income, Currencies, and Commodities. Opalesque Technical Research is unique compared to most available research which is fundamental in nature, and not technically (chart) oriented.
Opalesque Roundtable Series:
In an Opalesque Roundtable, we unite some of the leading hedge fund managers (single and multi strategy managers) as well as representatives of the local investor base (institutions, fund of funds, advisers) to gain unique insights into the specific idiosyncrasies and developments, the issues and advantages of individual global hedge fund centers.
No matter if you are a hedge fund investor looking for new talent, a hedge fund interested in diversifying your investor base or a service provider looking for new clients, you will get to know some of the leading heads of each hedge fund center and find invaluable information and intelligence right on your desk, without any travel involved.
For more information, please go to Hedge Funds News | Alternative Investment News
Understanding The Foreclosure Language: Words and Definitions Homeowners and Investors Need To Know
December 31st, 2009When a homeowner is facing foreclosure, they are bound to hear lots of words that are quite difficult to comprehend. A big reason for this is that foreclosure real estate has its own language thanks in part to legislation and law. With no background in this area, real estate investors are unable to get through the easiest foreclosure contracts. If you want to be a real estate investor, it’s necessary to learn the foreclosure-related terms.
14 Foreclosure-Related Words and Their Definitions That Explain The Foreclosure Process
Abandonment – A homeowner (property owner) who has decided to give up rights to the property without any coercion and fails to retrieve the rights or pass those rights to someone else. A situation where a property is unused is not considered abandon.
Acceleration Clause – This is a clause that is often seen in mortgage contracts that allows the lender the option to demand full reimbursement right away instead of at the end of contracted term. It must be stated when this will happen including default on regular payments, the sale of property or property rights re-assignment. Debtors are usually told within a reasonable amount of time with a chance to reverse this. A contract without this clause means the debtor is immune from any acceleration.
Chattel: This is personal property that includes household items.
Closing Costs – Closing costs are expenses unrelated to marketing and selling of property; these costs are seen in loan and paperwork fees. Foreclosures tend to involve fees for legal and escrow.
Deed In Lieu Of Foreclosure – When foreclosure is imminent, property owners have the option to hand their deed over to the lender instead of going through the process. In order for the deeding to be certified, the lender needs to be approved.
Default – This is when the borrower fails to make payments to the lender; this could mean missing a payment without further problems or too many payments that result in a unsuccessful mortgage.
Equity Rights Of Redemption – The borrower’s rights to eliminate all burdens that are related to the mortgage, in an attempt to circumvent foreclosure.
Federal Housing Administration – The FHA is a part of the Housing and Urban Development; this federal agency is in charge for setting trade standards for all mortgage loans given by private lenders. The FHA will also insure all mortgages; foreclosure investors will often deal with the FHA.
Federal National Mortgage Association – commonly named Fannie Mae; this is the federal agency that oversees the conventional housing mortgages and will often purchase loans that follow its government rules. Several foreclosure investments will require investors to have direct communication with the agency.
HUD1 Statement – This is a form required by the US Department of Housing and Urban Development that specifies what the costs are for obtaining a foreclosed home.
Loan TO Value Ratio – This is a comparison between the actual loan amount and the sale price/appraised value.
Notice of Rescission: Lenders will use this notice to let the borrowers know that they are in good standing and any payment deficiencies are corrected.
Short Sale: Property that has been priced below or at the market value and generally lower than the actual mortgage.
Truth In Lending Act – This law mandates the lender must give the borrower a full-written explanation of the mortgage terms.
