Most businesses grow through securing some form of outside funding, including offering a stake in the company to employees. It is important for a business to have funds ready so it can grow and take advantage of opportunities when they are presented. Providing equity to employees can be a sustainable and effective way to secure funding, it also attracts talented employees that the company may otherwise be unable to afford. For key considerations for offering equity are rationale, agreement, valuation and payment.
- When business owners want to fund a growth, they rarely finance it from their own pockets, especially if the growth is a significant one.
- During the discussions at the summit, some of the important highlights that were emphasized was the need to raise funds early.
- Some of the important funding options that are important to businesses that they should negotiate early are bank loans, equipment finance, crowdfunding, and private investors.
“At a recent business growth summit held over a week in France, business owners discussed the various funding models available to them, along with the pros and cons of each.”