capital raising for small businesses and freelancers
TRANSCRIPT
Capital Raising for Small Businesses and Freelancers:
Legal and Practical AspectsJune 2, 2015
Jeffrey A. Bekiares [email protected] / [email protected]
Essentials to Keep in Mind!
• Start-up legal essentials.• What makes a company “investable”.• Sources of Capital – From seed, to angel, to IPO.• Traditional and Alternative Finance criteria.• Crowdfunding – Traditional and equity based.• Legal and tax implications in raising capital.
Start-Up EssentialsDIY vs. Professional Assistance
• What You Can Do:• Form Business Entity / Publication
• Obtain Tax ID
• Register with DOR / DOL
• Obtain additional business licenses
• Company authorizations (sometimes)
• Discuss and (preliminarily) document your business deal!
• When You Should Request Assistance:• Operating Agreements / Shareholder Agreements
• Employment / Consulting Agreements
• Equity Incentive Plans
• Equity Grant Agreements
• Securities Sales Agreements
• Section 83(b) Election Letters
Capital Raising – High Level Issues
Type of Company
State of Company
Composition of Team
Protections & Future Incentives
Capital Raising: Traditional and Emerging Sources
• Seed Funding.
• Traditional Lenders.
• Alternative Lenders.
• Angel Investors.
• Venture Capital / Private Equity.
• Public Markets – “Firm Underwriting” or “Best-Efforts” Offerings.
• Crowdfunding.
Capital Raising – Seed Funding
• Advantages:
Network of first instance.
Most favorable terms.
• Disadvantages:
Does not work for everyone!
Does not diversify Risk
• What makes a Company “Investible”?
Capital Raising – Lenders
• Advantages:
Most familiar terms to the most businesses.
Most widely available geographically.
• Disadvantages:
Credit crunch; recession.
Highly regimented credit criteria; onerous paperwork.
• What makes a Company “Investible”?
Capital Raising – Angel Investors• Advantages:
Larger dollar value investment.
Addition of expertise to enterprise.
• Disadvantages:
Competitive Marketplace; spotty resources by location.
Highly industry specific.
• What makes a Company “Investible”?
Capital Raising – VC & PE Markets• Advantages:
High dollar access.
High connection quotient.
• Disadvantages:
High dollar thresholds.
Highly defined exit criteria.
• What makes a Company “Investible”?
Capital Raising – Public Offerings
Four Primary Varieties of Crowdfunding
Crowdfunding – Businesses Best Served
Deals with a local
character
Mom
and Pop
sEarly Stage Start-Ups
Bricks/
Mortar
Small Offering
s
The Invest Georgia Exemption / 2012
Designing a Winning CampaignCommon Elements
• What kind of Company is likely to be the most successful and why?
• What does the Company offer?
• Who is the target audience?
• How does the Company present the offer?
• How does the Company handle its backers after the campaign closes?
My Contact InfoJeffrey A. Bekiares, Esq. [email protected]
ATLANTA TECH VILLAGE Suite 5553423 Piedmont Road, NEAtlanta, GA 30305
To schedule a consultation with me please e-mail or call anytime!