Chapter One

Raising Capital At Any Stage of a company's growth is challenging and requires creativity and tenacity, but these hurdles are especially difficult to conquer at the earliest stages of an enterprise's development. In this chapter, we'll take a look at where and how to raise capital at the seed level - when you're first organizing your business, or when it is at its earliest stages of growth.

In the chapters that follow, we'll look at funding strategies that are commonly used after a business gets past the start-up phase and establishes a steady flow of customers and a reliable revenue stream, even if the company is not yet profitable. These include: alternatives for raising capital at the early stages; private placements (a more organized and expanded method of angel financing for moderate- growth companies); commercial debt financing (once the business has assets in place to serve as collateral for the loan); and ways to acquire resources that you would otherwise purchase if you had raised capital. Later in the book, we'll explore growth -financing strategies such as seeking institutional venture capital (for rapidly growing companies that offer exceptional potential returns on investment) or raising capital by taking your company public with an initial public offering (IPO). Then we'll offer some creative alternatives to traditional financing as ways to grow your business. The main thing to understand is that no one plan fits all: The strategies available- and useful- for a particular company depend mainly on its stage of development and the nature of its business. What works for a start-up retailer ma