1. GUIDE TO ACQUIRING STARTUP FINANCING

2. CONTENTS 2 BEFORE YOU BEGIN FORECASTING TYPES OF WORKING CAPITAL FINANCING CAPITAL FOR FIXED ASSETS POTENTIAL FUNDING SOURCES FINANCING PACKAGES HOW A CPA CAN HELP

3. BEFORE YOU BEGIN 3 YOU WILL NEED: A written business plan Objective Management team Market Products and services Competitive advantage Financial forecast

4. FORECAST REVENUE, EXPENSES AND OPERATING CAPITAL REQUIREMENTS CALCULATE: –Monthly projected sales revenue (minimum of 36 months) Break down by cash sales and credit sales (accounts receivable) Include assumptions SUBTRACT: –Monthly expenses Product costs Salaries Rent Utilities Insurance Software subscriptions Travel Interest on loans (assume market rates) Credit card processing fees Any other significant expenses (except depreciation) Non-financed fixed asset purchases Product purchases that remain in inventory Principal payments on loans. 4 – Other monthly cash outflows RESULT: Operating capital required

5. EVALUATE TYPES OF WORKING CAPITAL FINANCING LINES OF CREDIT –Short-term –12 months operating history –Monthly interest payments –“Callable” –Secured –Personal guarantee –Covenants TRADE CREDIT –Typically 30 days –Relationship/performance based –No interest 5

6. DETERMINE CAPITAL NEEDED FOR FIXED ASSETS FACILITY EQUIPMENT TECHNOLOGY FURNITURE AND FIXTURES VEHICLES 6

7. LIST YOUR PERSONAL ASSETS AND LIABILITIES PERSONAL FINANCIAL STATEMENT DEMONSTRATE FINANCIAL COMMITMENT BY: –Investing cash in the business –Signing a personal loan guarantee –Pledging personal assets as collateral CREDIT REPORT 7

8. IDENTIFY POTENTIAL FUNDING SOURCES BANK LOANS SBA LOANS LEASES CREDIT UNIONS VENTURE CAPITAL GRANTS AND COMMUNITY DEVELOPMENT LOANS CROWDFUNDING 8

9. PUT TOGETHER A FINANCING PACKAGE EXAMPLE FOR A CRAFT BREWERY 9 SOURCEAMOUNT Owner’s personal savings/investments $50,000 Angel investor 25,000 Job creation grant from regional economic development authority 50,000 Grant from downtown development corporation to renovate historic building (made to building owner who will leases to you) 50,000 Capital equipment loan from community bank 200,000 Total $475,000

10. A CPA CAN HELP YOU FINANCIAL FORECASTS PERSONAL FINANCIAL STATEMENT FUNDING SOURCES FINANCING PACKAGE BOOKKEEPING, FINANCIAL STATEMENTS AND STRATEGY 10

11. Questions?

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