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New Business For Women

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Investors and Equity



Practically every economy is built upon the backs of small businesses and entrepreneurs. Every day someone comes up with an idea that will make a great business. Every day, these same people wonder how they will come up with the cash to get the business off the ground. The classic answer is to look for investors, and this is where things can go bad.

If you're seeking investors for your business, you are going to need to form a business entity. Corporations and limited liability companies are the most popular, and give you the ability to trade ownership interest in exchange for cash contributions. With a corporation, investors will buy shares in the corporation. With limited liability companies, the investors will buy membership interests. Regardless, this traditional exchange gives rise to a problem common among small business owners, to wit, giving away too much equity.

From Joy to Misery

A common mistake made by new business owners is to give away too much equity when getting initial cash contributions. This occurs because you let insecurities impact you evaluation of the business. Instead of giving away two percent of equity in exchange for $50,000, you give away ten percent. Let's look at an example.

I start a business selling digital gadgets. I prepare my business plan and realize I need $250,000 to get everything up and running. I have $50,000, but need to find the rest somewhere. I form a corporation with 1,000 shares and start approaching potential investors. I offer 100 shares for $25,000. I find five investors that give me $125,000 in exchange for 500 total shares. In summary, I now have $175,000, but have given away half the equity in the business. While I am not happy about this, I am still so enthused about the business idea that I shrug it off.

The business gets rolling and I start selling gadgets like a madman after one year. This gives rise to a serious cash problem. I am getting orders, but can't fill them because of cash flow problems. To make a proper go of the business, I need another $100,000.

Where am I going to get $100,000? My business is only one year old, so a bank won't touch it. My investors haven't seen penny one back, and are unwilling to put more money in. My only option is to sell another 400 shares for $100,000. Fortunately, I sell the shares, raise the money and stay in business. However, there is a major problem.

In raising all of this money, I have now sold off ninety percent of the equity in the business. I am left owning 100 shares and only 10 percent of the business. This is going to severely impact my physical, emotionally and overall motivational well being. Slowly but surely, I am going to become very bitter. It was my idea and I am doing all the work! It isn't fair that I only own 10 percent of the business!

On second thought, this impression may come on very quickly. Regardless, the business is destined to experience major problems because the primary motivating force is no longer motivated. Unfortunately, many people with business ideas run into this problem.

If you are starting a business, guard your equity at all costs. Selling equity should be a last resort. Try to get loans or trade profit sharing in lieu of selling equity. If you must sell equity, do so only in small percentages. You do not want to the small business person in the example above.
New Business For Women
There's nothing an animal lover enjoys more than getting to spend time with their favorite furry friend and with a pet franchise you can spend plenty of time with animals while making great profits for yourself. There are quite a few new and exciting business opportunities for the animal lover these days and regardless of your business experience, if you have a love of animals and the drive and desire to own your own business, then you have what it takes to startup your own pet franchise. Here's a quick look at seven different pet franchises that not only serve to help out pets and their owners, but have also been proven to be very successful businesses.

Dogtopia

While Dogtopia is labeled as a Dog Spa, they also offer an upscale day care for your furry friend. Rather than a series of kennel runs, Dogtopia provides a supervised open environment where the dogs can play and the owners can even check in on their dogs via the live webcam. As a franchisee you'll spend plenty of time playing with the dogs and providing a safe and stimulating environment for them through the day care, training classes, spa services and retail sales.

Kennelwood

Recognized as on of the finest pet resorts in the world, Kennelwood pet resort provides a safe and healthy “vacation” for your dog in a truly amazing environment that makes ordinary kennels and dog boarding services seem like animal cruelty. From their award winning grooming services and professional training to the doggie day camp and personalized play times, dogs love Kennelwood so much that they often pull their owners into Kennelwood on return visits.

Doo Care

Although it may not seem glamorous, the dog waste market is rapidly expanding in metropolitan markets and is a relatively untapped area of the service sector. Doo Care provides waste removal for busy families, the elderly or any of the nearly 50 million dog owners in America. With such a high demand and very few businesses stepping in, it's easy to see how a Doo Care franchise could really clean up.

Pet Depot

With the slogan, “Where animals come first” Pet Depot is a retail pet store chain that provides customized, personal service to their customers and with nearly 60% of all households owning at least one pet, the retail pet market has never been bigger. Unlike many retail establishments which may see the average customer returning 5-6 times per year, pet owners will buy pet food along with other supplies every 2-6 weeks, and most pet owners will buy their food and supplies at the same location every time, giving you a high level of repeat business and steady income.

Wild Bird Centers

We've looked at quite a few franchises that cater to dogs, but if you're a bird lover you may want to consider a pet franchise with Wild Bird Centers. With the highest average sales and lowest cost of goods in the specialty birding industry, Wild Bird Centers is by far the winning choice in this niche market. If your knowledge of birds is lacking, but you're still interested in this unique franchise, Wild Bird Centers will provide you with comprehensive training about the ins and outs of their franchise businesses and they'll also teach you everything you need to or ever wanted to know about birds.

Bark Busters

Bark Busters is a home-based franchise that gives you the training to be a skilled, on-site dog trainer in very little time. With Bark Busters' proven method (which has trained over 300,000 dogs worldwide) you can tap into the $36 billion dollar pet industry with confidence knowing that Bark Busters is the #1 pet franchise (as ranked by Entrepreneur.) With many unique qualities such as a “Life of the Dog Guarantee” and the ability to change a dog's unwanted behavior in a two to two and a half hour session, Bark Busters is a great franchise for the working mom, and a must for any pet lover.

Camp Bow Wow

For a high-class, upscale approach to doggie day care, consider a franchise with Camp Bow Wow. Camp Bow Wow's “four-paw” service has earned them national recognition in newspapers, magazines, television shows and all over the internet, and if you think humans like Camp Bow Wow, you should see the reaction your dog will have when he's pampered by the Camp Bow Wow staff. Camp Bow Wow is the first and largest franchise in the doggie daycare and boarding industry and offers a fun, safe environment for dogs to play while also promoting good health and socialization with every aspect of the camp tailored around what is best for the dogs. This business model attracts the more upscale, high-income clientele and makes this franchise a great moneymaker for any dog enthusiast.

If you love pets and love the idea of running your own business, you can't go wrong with a pet franchise. Not only will you receive all of the training and materials needed to start your business from scratch, you'll also be able to rest easy knowing that each of these pet franchises has built their business from the ground up and found the right formula to run a successful business without making any sacrifices to the well being and care of our furry friends. Even if you've never owned a business before, these pet franchises make it easy for anyone to start and run a successful business by providing extensive training as it relates to their business and many will offer general business and management training to prepare you to run your new business successfully and make a lot of pets and owners your satisfied customers.
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About Author
Both Rick Chapo & Candice Clem are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Rick Chapo has sinced written about articles on various topics from Phishing, Home Improvement and Women. . Rick Chapo's top article generates over 22200 views. to your Favourites.

Candice Clem has sinced written about articles on various topics from Work From Home, Online College and Work From Home. Find more including. Candice Clem's top article generates over 60500 views. to your Favourites.
Bioterrorism Preparedness And Response
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