financing, georgiaIt is two years since I started a company for issuing online payday loans, and it is working really well bringing back nice profit which I put all back in business. So far it was all my or my family money and now they are obviously not enough.
I don’t want to stop growth of my business and I am looking to attract investments. The perfect would be getting credit line 50-250 thousand euro initially for which we can simply pay something around 24% annually.
When I go to my local bank, they ask me only whether I can place a guarantee of real estate, and when I say no (as the company doesn’t own any real estate), they dont want to continue.
In European Union such rate would be fantastic for banks as they issue business loans for half of it, but here in Georgia I can’t reach them, or at least I don’t know how or whom should I contact.
How can I attract capital in my described conditions? I am ready to provide any documentation/information/data, including most internal financial data, my tax declarations, bank account extractions, etc.
Putting aside the source of the capital, in my opinion, you’ve failed to make a solid case for either why you need the capital or why an investor would have any reason to believe that you would be able to make use of it.
My suggestion would be to focus on your pitch before you focus on sourcing the capital to grow the business.
What is your sales volume and what is your profit percentage? Have you included any amount for your personal (wage) expense in your profit calculation? Of your profit, what percent do you put back into the business? These are the questions anyone evaluating your business would ask. For a banker, his question would be what is your cash on cash rate of return? And how quickly can I get my money back? If it is not big and fast, it will be difficult to find any banker or any investor to loan you money. Not only that, but international loans are risky for many reasons, so if you do not have a physical location where the bank is, most are not going to lend to you.
If it is as profitable as you say, let it grow itself for a while. Two years for a startup is not a very long period. Since you do not have a software or internet company, it will take a bit of time to grow.
Also, as previously said, payday lenders do not have a positive reputation. Most banks do not want to tarnish their reputation by lending to such a business. Your best bet is not to get greedy and take your time to grow a solid stable profitable company. If the business market is as large as you say, it is not going away. As your company grows so does your cash.
All content is licensed under CC BY-SA 3.0.