Tech companies need funds in the initial stages to market and advertise their brand. The organic growth of companies has a limit and it may be necessary to call on external financing. Growth funding operations are often built with the financial assistance of private growth funding companies. Growth financing enables you to realize your internal or external expansion projects. It comes from the company’s internal financial resources (treasury) or very specific external financing solutions. The financing of a tech economy requires significant capital and various economic agents. These financial and legal transactions are reserved for mature and profitable companies.
According to the latest reports by Fortune, more than 40% of tech companies shut down due to a lack of financing. More than 50% of companies stay in the struggle phase for 10 years. Only 3% become able to secure their presence and generate profit. All this happened due to uncontrolled and unsymmetrical usage of finance.
Tech companies need funds in the initial stages to market and advertise their brand. The organic growth of companies has a limit and it may be necessary to call on external financing so that the company can pass important stages in its development. The financing of a tech economy requires significant capital and various economic agents.
Different modes of financing exist. In particular, a distinction is made between monetary financing, i.e. financing with monetary creation, and non-monetary financing corresponding to the use of the financing capacities (prior savings) of certain agents by other agents with financing needs.
Direct financing consists of connecting the lender and the borrower through growth funding. Indirect financing relies on the existence of intermediaries between lenders and borrowers. Intermediated financing is therefore carried out by the various financial intermediaries.
These financial and legal transactions are reserved for mature and profitable companies. Most of them are companies that have a solid and stable financial structure. Indeed, growth funding necessarily involves financing the target to be acquired. It comes from the company’s internal financial resources (treasury) or very specific external financing solutions. Growth funding operations are often built with the financial assistance of private growth funding companies.
Process of Growth Funding
Markets and companies continue to develop, new potentials are discovered, and ideas are in demand and want to be realized. Being able to seize market opportunities is an important basis for being able to grow successfully. But one engine is seldom enough for successful progress. This applies to both corporate strategy and corporate financing.
Anyone who relies solely on the traditional sources of finance equity and credit leaves important potential untapped – especially when quick strategic decisions focus on fast and tailor-made financing. An effective and safe growth financing that is tailored to your needs, does not come today, and more often from a bank. In the following, we will shed light on the topic and introduce you to bank-independent solutions. A change has taken place in the area of growth financing in particular, which offers you new opportunities to move your company forward efficiently and quickly.
Why Growth Financing?
Do you already have a certain position in the market and are you planning the next growth step? Growth financing enables you to realize your internal or external expansion projects. What are you going to do? What are you aiming for? Do you take the time in advance and check how your company should expand and what goals you want to implement?
It covers the following points
- Company growth at the local level or international level
- What do you need for your business to grow
- What is your growth geared towards
- What is the payment behavior of your customers
Possible Financing Reasons
Digitization projects, product innovations, or expansion of the operational business – here you will find an overview of the most common occasions when you have to finance:
- Expansion of the product range
- Increase of product capacities
- Establishing subsidiary companies
- Opening additional branches
- Hiring new employees
- Establishing further production
- Increase the sales of your product or services
Who Can Get Funded?
Well, it depends on the investing company. It may have its requirements. But in general, these are some common requirements that a tech company must fulfill to acquire or to be able to get funded. Any company with a potential growth product or services meeting the following criteria:
- Company with a real growth project identified with job creation
- Businesses should be running and generating revenues
- The Official company name should be registered
- Company website with professional business emails
What is Provided By Funding Company?
Fund companies are business entities, both privately and publicly owned, that manage, sell, and market closed-end and open-end funds to the public. They typically offer a variety of funds to investors, which include portfolio management and occasionally custodial services. You can get $3m to $100m credit for tech within 24 hours.