(249)Selecting An Equity Finance Consultant


William Cate

Most Chief Financial Officers (CFOs) realize that it's a hundred times easier to raise venture capital for a public company than a private company. There is no shortage of individuals and firms seeking to advise and coordinate the going public process for CFOs. The problem is that many of these equity finance consultants are inept and/or dishonest. Here are some simple rules for finding a competent and ethical advisor.

Avoid firms that don't disclose anything about themselves or their employees. The Net is a wonderful free-tool for doing "Due Diligence" investigations on firms and individuals. Do an advanced search on the firm and its principals. Credit checks and background investigations are wise investments before you hire any consultant.

All equity finance consultants have two basic ways to take your company public. They can help you do an Initial Public Offering. Or they can suggest one of several alternative ways to go public in the USA. None of the alternative tactics include a public financing for your company. Whatever solution the prospective equity consultant advises, you should ask for an estimate of costs, time to trading and the odds of being called for trading. You should also determine how the equity finance consultant expects to make money helping your company go public.

If you have an operating company and decide to do an IPO, your costs should average between $1.5 and $2.25 million. You should expect that it should take an average of 18 months to get your "Effective Letter" from the SEC. And your odds of success are about even, that is, 50/50. You should expect to pay your underwriter about 18% of the money raised. You will be expected to pay non-refundable upfront expense fees. You should budget $10,000/per broker presentation that will be needed to help the underwriter raise your IPO money. If your prospective consultant disagrees with these guidelines, ask them in writing for the evidence to support their viewpoint.

IPO alternatives range in costs from $60,000 to several million dollars. Amazingly, the most expensive IPO alternative is the most popular. While doing a reverse merger shouldn't cost your company more than $150,000 in out-of-pocket Due Diligence costs, the expense of maintaining your shell float's share price will run into millions of dollars.

In a reverse merger, the public shell insiders retain their shares. This means they have several million shares of your stock to sell. You are responsible for finding the public buyers of their stock and all future shareholders of your public company. Let's assume that the reverse merger insiders have three million of your public company's shares. Your goal is to maintain a $4 share price. The previous shell owners will gross $12 million on the sale of their reverse merger shares. It should cost you $0.25/share to buy the past owners' shares. The past owners will take a three million-dollar bite out of your investor relations' budget.

However, that's only the beginning of your problems. Your reverse merger public company must now find the buyers, each quarter, for those past insider shares. Assuming you can maintain the same $4 share price, the estimated annual investor relations costs will be $12 million per year, in addition to any other shares in the public float. This $12+ million investor relations cost will continue as long as the company is public and trading at $4/share.

The cash price of an OTCBB (Over-the-Counter Bulletin Board) shell with 90% or more control is about $1.5 million. The primary advantage to a shell purchase is that the buyers are certain that their shares will trade. The major disadvantage is that the shell insiders often create shares for themselves and hide this fact from potential buyers. The industry axiom is that there is no such thing as a clean shell. Thus the buyer also inherits the future costs of finding the buyers for those hidden shares.

There are alternatives to taking a company public whic cost less than $100,000. They don't create stock that enters the float. If you are interviewing potential equity finance consultants, you should ask them for their low cost strategy and determine its odds of working for your company. You should also ascertain the ongoing investor relations costs of any public company strategy.

Most professionals in the equity finance business have far more interest in short-term profits than long term earnings. If your purpose in going public is to give your investors a "liquidity event," you'll easily find equity finance consultants who share your myopic vision. If you are going public to build your company, you should read my ebook Venture Capital Profits. It's the formula for a win/win public company strategy. The public profits. The insiders and private placement investors maximize their profits.

About the Author: Since 1981, William Cate has been managing Director of Beowulf Investments [], a Merchant Banking and Equity Finance Consulting firm. He can be contacted at:

About the Author
He has been the Managing Director of Beowulf Investments [] since 1981 and is the Executive Director of the Global Village Investment Club []

Written by: William Cate

(250)Self Employed Loans- Ideal source of finance for self-employed


Making a mark for oneself in the competitive world of business is tough. Especially for people in UK who are self employed and don't have access to that extra sum of money that can make the task easier. But, where can they get that money from? Well, the answer to this question can be easily traced with the introduction of self employed loans in the loan market.

Self employed loans are tailored to meet the financial needs of self employed people. They may need funds to expand or to start a new business. Self employed people are identified as people who operate their own business as a sole owner or as a partner or a profession. Independent consultants and contractors are also classified as self employed.

There are different characteristics of self employed people that differentiate them from the working group. Self employed people have unstable income as profits vary from one period to another. They do not have proof of their income.

In the past, it was difficult for self employed people to borrow money from the market. The main reason behind this is that they do not have a regular source of income; this seemed to pose a big hindrance in the path of getting finance for investment.

But, now time has changed. With the entry of self employed loans it has become easier for self employed people to get an easy financial help. With the increasing number of people who prefer to work for themselves, self employed loans have now become affordable and widely available.

Self employed loans can be secured or unsecured one. Secured self employed loans are secured against the collateral of the borrower such as a car or a house. Unsecured self employed loans are not secured by any collateral, thus involve a high interest rate.

Some lenders in UK offer flexibility to the borrower by accepting overpayment, underpayment and payment holidays. Let me explain these terms which will make it easier for you to recognize the benefits of taking a self employed loans. Overpayment imply that a borrower pay more money for a month than the amount due. While underpayment is just the opposite of overpayment, it gives the borrower the freedom to pay a lesser amount in a month then the amount due. Payment holiday is completely different from the two mentioned above. It allows a borrower to skip a limited number of monthly payments after an initial period of regular payments.

Lenders of self employed loan assess borrower's income to evaluate the amount of risk involved in lending money to the borrowers. They assess the income of a loan applicant basically by two ways:-

* Self Certification - In this case, a borrower self declare his income and the lender do not insist on considering the audited accounts. But there are some lenders who will need a borrower to submit an accountant's certificate. This is a document signed by a borrower's accountant that entail that borrower has sufficient income to pay the monthly installments and the loan. Most of the lenders supplement this information with evaluation of the credit score of the borrower.

* Certified Accounts- Certified accounts of the borrower will be issued by the borrower's accountant briefing the details of the borrower's income on yearly basis.

Lenders can arrange self employed loans for homeowners or tenants for any amount ranging from £3000 to £ 250,000. With the competition increasing day by day in the loan market, lenders are ready to provide the loan at low interest rate. Interest rate is determined keeping all these in consideration amount to be borrowed, borrower's credit history and the loan term.

A good credit score will definitely help a borrower to get a loan for a larger amount at low interest rate. But, this loan is not confined to good credit people only. Bad credit, CCJ or bankruptcy cannot stop you from getting this loan; however you may get it at a bit higher rate of interest.

Survival of the fittest is the trademark used in the world of self employed people. But to survive one need to match pace with the changing technology which is possible only when you have a financial backup. Self employed loans give financial support to the self employed people so that they too can make a mark in the competitive world and reach new heights of success.

About the author:

Amanda Thompson holds a Bachelor's degree in Commerce from CPIT and has completed her master's in Business Administration from IGNOU. She is as cautious about her finances as any person reading this is. She is working as financial consultant for chanceforloans .To find a Personal loans,bad credit loans,Debt consolidation,home equity loans at cheap rates that best suits your needs visit

Written by: Amanda Thompson

(251)Shopping for a Personal Loan to Suit Your Finances

Just as one would shop around for the right automobile to suit your taste and financial style, the same is true in shopping for a personal loan. If you’re thinking about taking out a personal loan, it’s important to make sure it matches your paying and financial composite. For example, do any of the following apply to you?
If you plan to take out a personal loan do you plan to repay the loan off fast?
Would you prefer to stretch your repayment plan out for as long as possible?
Do you have poor credit – therefore gaining a personal loan approval is important to you?
Are you looking for the lowest interest rate possible on a personal loan?
Because you require a large sum of money (over $10,000) you would like to put your home up for collateral?
As the above questions depict, personal loans come in all assortments with varying terms and payment guidelines. As we all know all men are created equally, but not all salaries and personal loans are right for all financial needs.
Did you know that the average American consumer (almost 60 percent) carries – an average debt of over $10,000? Moreover, almost 60 percent neglect to remit their monthly credit card and mortgage balances on a timely basis. The profile of the middle class family is generally cash-challenged and used credit cards for their basic necessities.
In the realm of personal loans, American consumers must take caution during the search for a personal loan. Financial desperation has a way of affecting a consumer’s judgment. Banks, creditors and lending institutions are targeting the financially fraught consumer. The sector is referred to as a "sub-prime" market. The target audience is the working poor or impoverished who are in most cases unable to make payments.
The rampant growth of the industries has been evident in both mortgage lending and cash advance firms. Normally, sub-prime loans (home financing and payday) are accompanied by mammoth interest rates. In reality, it boils down to supply and demand.
After all, why should an organization dole out loans or credit to consumers who are unable to pay or have demonstrated a poor payment history.
Fact: Annually, creditors and financial institutions charge over $7 billion in late fees.
Despite the advantages and drawbacks of personal loans, here are a few ways to shop for a loan customized to your financial style:
Fast Repayment Plan
If you plan to take out a quick personal loan to hold you off until you receive a tax refund or even a salary bonus, look for a personal loan that does not have a prepayment penalty. Since many payday loans and other personal loan products are designed to make the company money over the life of the loan, many carry a pre-payment penalty clause. Read the fine print and thoroughly review the contract to avoid being pigeon-holed into a personal loan.
Extended Repayment Program
The unemployed consumer should look for the personal loan where the repayment plan can be stretched out overtime. Opting for this type of loan can circumvent the chance of biting off more personal loan than one can afford while they are looking for gainful employment.
High Interest Rate
Some consumers do not have the luxury of being choosy in pursuit of a loan. Particularly, for the indebted with a low credit rating, the chances of personal loan approval may be limited. Generally, financial institutions up the interest rate based on how risky they deem the loan to be. Also, if a person has shown a poor payment history, the only way for the lending company to protect their interest is by charging an excessive interest rate.
Lowest Rate
Although the lowest interest rate possible always sparkles with appeal, it can be tricky. Pay particular attention to any personal loan that sounds too good to be true. For example, certain fraudulent lending companies will detail ambiguous wording in a personal debt agreement to purposely defraud the consumer of property (house or car).
Secured Loan
For a lending institution’s perspective, the secured personal loan is completely failsafe for the bank. In any case, if the borrower defaults on the loan, they have an expensive property to sell to even make a profit. Before selecting a secured personal loan evaluate if the risk of possibly losing one’s home is worth the pay-off of any loan worth $10,000 or more.
Whatever you personal loan you decide to take out, remember to prioritize what is important and only select the loan tailored to your financial situation.
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About The Author

Holly Bentz is a finance writer and a contributor to About Personal Loans.

Written by: Holly Bentz

(252)Short on cash? Finance the Mortgage Points


Once you get a quote for a home loan don’t be tempted to take the entire amount if it looks like you overqualified. Most consumers fill out an application for a home loan and hope they can get enough money to buy their dream house.

A nice chunk of those consumers also overqualify for their home loans. If go to your local bank, credit union or mortgage broker and you are approved for a $500,000 home loan, they payments might be a bit more than you realistically afford.

Look at your entire budget
If you are not good with your money or would prefer to not stretch your finances to the limit to get a home, get your hands on a good mortgage calculator as soon as you get the figures on your home loan. You might think all will be fine as long as you can own your own property.

However, you must take into account all of the things that come along with owning a home. Sometimes you can get so caught up with the actual dollar amount of your home loan that you forget the other pieces of your budget.

Check your budget to see if you still have money to enjoy things like going out, purchasing new furniture, a family vacation once per year and regular manicures and pedicures. Then add in your student loans, car payments, credit card bills, lunches at work and tickets to take your family to baseball games a couple of times every season.

Don't forget home maintenance costs
There are also the home maintenance issues that are not included when you qualify for a home loan. If you live in a part of the country that’s particularly hot or cold, your heating and air conditioning bill could easily add up to a couple of hundred dollars per month.

Your home loan package does not include budgeting for lawnmowers, landscaping and fixing broken windows. Some of these expenses can be put off until a later day, but some of them will require your immediate attention once you move into your home.

Know your spending habits
If you are used to living paycheck to paycheck and generally not taking care of your budget as a renter, you will probably carry over some of the same habits to your new home.

The best way to avoid a financial disaster is to make your home loan a part of your financial life instead of the centerpiece of your financial life. If you are stressed out about money issues from the very first move in, it is unlikely that you will enjoy your new home or anything else in your life for a long time.

About the Author
This article may be freely distributed as long as there's an active link to
Syd Johnson

Written by: Syd Johnson

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