Business Financing Alternative Options In Canada . Surprised At The Different Personalities ?

Is Business Finance In Canada Changing Dramatically ?


OVERVIEW – .Information on business financing alternative options in Canada ..




Business Financing methods . New and existing businesses are always looking for capital. Although a solid majority of business owners, managers and entrepreneurs know where to look, many can’t make that claim. Additionally there are a number of little known ways to finance a business that are not as ‘main street ‘ as the obvious choices – our Canadian chartered banks, etc.

We suppose if the entrepreneur/owner knew exactly what to do all they would need is the Yellow Pages and a phone; however that is not the case.


Looking for financing methods requires that you immediately ‘slot’ your needs into one of two buckets – equity, or debt. Naturally the SME sector in Canada is not funded from an equity perspective via our banks. Simply – they don’t do that!

The other natural tendency is to take the government up on their offer of assistance. Like you, we’ve seen the commercials! When it comes to real world access to government funding we work with our clients in two areas – The federal government SBL loan, and SR&ED tax credit financing. Either of these two are tremendous ways to help finance your business, particularly in the early stages.

Some other methods of equity financing in early stages include angel investors, reverse takeovers of public companies with cash and no business currently inside them, and the newest kid on the block , ‘ Crowdsourcing ‘ . (It’s our understanding you simply ask 1 Million people for 1$!)


In Canada there are a number of Community Futures programs which fund regional development via loans. It’s our experience these loans have never provided the business owner with all that they need, an alternative financing is also required.
Many business people aren’t aware of Royalty financing, it’s an innovative way to promise future payment via future sales. You just need the confidence you can make those sales goals from your lender.


At 7 Park we focus on the more common methods of financing a business – including:


A/R finance
Working Capital Term Loans
Equipment finance / Sale Leasebacks
SBL loans
Asset based lines of Credit
Revolving bank facilities
Etc.



What are the biggest challenges encountered in financing a business?

When examining debt financing options challenges that business people need to address include:

The need for hard assets which can be collateralized or monetized
The need to give up assets as security for debt type financings
Ensuring that your business assets have real value – i.e. Realizable receivables, sales growth, quality inventory turnover, etc


When you are looking for equity financing, which is not our specialty at 7 Park Avenue Financial the mindset of the investor (not a lender) changes. They want technology or businesses with a proven competitive edge, strong growth potential, sensible exit strategies.


What are the things you should avoid when financing a business?


At 7 Park Avenue Financial we’re always cautioning our clients to separate their personal finances from their business finances. Tapping significantly into registered savings plans is by far not the best funding option if you can access other options. And by the way, debt is cheaper than equity – look into that comment!


How will you document the financials of the business?



This is a great question. Documenting your financials via a realistic business plan and cash flow forecast is key. Just being able to answer simple questions such as ‘ how long will it take you to collect ‘, ‘ are your costs in line with others ‘ ‘ how will you market your product or service ‘ are key to winning over a lender or investor . You have to be able to estimate reasonable sales and show a cash flow that shows ‘how your company works!”


What are the necessary skills you should possess to run this business efficiently?


Operating and financial management skills are key to how you will be perceived and dealt with by lenders and investors. Your management and financial skills must be clearly evident to lenders, either through your financial track record in business, or in person meetings to present your firm. If your company is perceived as ‘incomplete’ when it comes to key personnel you will never get the full financing you need at rates, terms and structures you want.


Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with methods to finance your company – both alternative and traditional .





Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


7 PARK AVENUE FINANCIAL = BUSINESS FINANCING ALTERNATIVE OPTIONS !



CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653

Email = sprokop@7parkavenuefinancial.com

















Stan Prokop