For any new business that is in the start-up phase, funding is often an essential requirement. Many new business owners may not have the necessary capital to start trading or want to risk their own money. In this case, rather than have to give up on the next big idea or product, you can opt to find investors to back you.
Naturally, this can be in the form of traditional bank loans, loans from private investors, or even public funding from the US Government if eligible to fund your new venture. Many US companies will now look at another option in addition though – international funding.
What is international funding, and why is it a good option?
International funding is simply obtaining financial backing from investors in a foreign country. The thing that makes foreign investment so attractive is the extra opportunity that it brings to find an investor to help your business. In addition, it also allows you to increase revenue by penetrating markets that your investor is influential in that you otherwise wouldn’t have.
How can you find a foreign investor?
Of course, the search for foreign investors may take a little work and some time. Here are some great ways to find that perfect backer abroad:
- Approach a multinational – one very simple and direct way to attain potential investment from abroad is to contact multinational corporations. A key factor to remember here is to contact the decision-maker in the business and also formulate a robust business plan that explains why the investment is a wise move for them.
- Trade fairs – to make finding that foreign investor simpler, why not laser in on the best ones within your sector? Utilizing trade fairs and conferences to do this can really bring great benefits and help find you the financial backing that you need. Many investors will attend the big trade shows looking for start-ups to back, so it makes sense to be there.
- Investor databases – another easy way to find that ideal backer abroad is with a database of potential investors such as Gust or VCgate. These databases will allow you to look for foreign investors in certain countries or industries in the simplest way.
Financial issues when working with foreign investors
There is no doubt that international investment is a fabulous option to get the backing your start-up needs. You do need to be aware of the challenges that this type of investment can bring though. For starters, you will be working with someone who may have a very different set of values or expectations than you are used to. Of course, there are also the financial issues that working with an investor abroad can bring. To help with this, you need to find a way to transfer funds internationally – this could be UK to US funds transfer or any other country combination.
Help your start-up get started up
When you first begin business with a new start-up, funding is something that you need to sort out quickly. This will allow you not only to stay in business but also provide funds to buy stock or produce your product. If you have never thought about using international investors before to do this, maybe it is time that you did.