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August 2017 Archives

Exit strategies are more important than most people think

Many Colorado entrepreneurs think of exit strategies as being merely paragraphs that make up obscure sections of their original business plans. As such, exit strategies are often forgotten even though they should be treated as legal concerns with growing a business. One of the reasons why exit strategies become nothing more than an afterthought is that they are seldom formalized. Instead, they are often included in business plans as boilerplate for prospective investors and lenders to review.

Newer companies having problems getting funding

Startup businesses in Colorado and throughout the country are finding it harder to get capital compared to established companies. This is the case even when both startups and mature companies have the same credit profiles. That was a key finding from a Federal Reserve survey that was published on Aug. 8. Despite this, 43 percent of small businesses that had been around for five years or less and had employees were growing revenue. This was compared to just 22 percent of more established small businesses that had employees.

Funding and business names

Entrepreneurs in Colorado should know that the type of name that they have for their startup could be a factor in the amount of funding they are able to obtain. Startup names that are easy to pronounce are favored by investors in the early and late stages of a startup's development. Angel investors, venture capitalists, crowd funders and IPO investors tend to provide more funding to these companies.

How entrepreneurs can build low-cost marketing campaigns

Colorado startup companies are often initially cash-strapped, and as they struggle to find the revenue to stay afloat, some owners decide to cut back on their marketing and advertising expenses or eliminate them entirely. This can be a mistake, because a strong marketing program can drive sales and bring a consistent revenue stream into the start-up. Entrepreneurs may instead want to develop a low-cost marketing strategy that can help their businesses grow.

Venture capital expands in an unlikely industry

Innovative companies in the insurance industry have enjoyed significant growth in venture capital over the past two years. Some Colorado investors may notice an obvious contradiction between the insurance industry's focus on risk management and venture capitalists seeking speculative high rewards. However, the recent turn should not be a shock, according to analysts.