If your business is trending upward, investors might be willing to buy-in for the right price. In exchange for an ownership stake, angel investors and venture capitalists provide investments that can help your business reach the next level.
However, there are strings attached. Investors might demand a large ownership stake and even managerial or board positions. The infographic below illustrates the pros and cons of equity financing for your business.
Who wouldn’t want to receive a huge check from an investor? Equity financing sounds appealing, but in reality, it’s extremely difficult to successfully accomplish. Finding, pitching and obtaining investment takes considerable time and effort, something many business owners are already short of.
On the other hand, small business loans stand as a viable alternative to equity financing. To learn more about small business loans and whether they’re right for your business, see our debt financing infographic; for yet another alternative, see our video on bootstrapping secrets.
If you’re ready to go after equity funding, check out our tutorial on creating a pitch deck. For more info on the entire process, including tips on pitching to angel investors and venture capital firms, see our free e-book, The Complete Guide to Equity Financing.
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