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Private Investors

Should Your Business Seek Private Investors?

A common objective for someone starting a business is the eventual expansion of that business. However, as you already know, making a business profitable can take some time, so it can be difficult to expand on your own. That’s why many business owners consider private investors to help them overcome this challenge.

Making Concessions

As any Boston business attorney will tell you, an investor is going to have some impact on the way you operate your business. Though they are typically not involved in the day-to-day decision-making, they will usually make some demands up front. This means you have to be willing to make some adjustments with regard to the structure of your business. It also means that when it comes time to pass on or sell your business, an investor with stake in the company could affect the process.

Are There Other Options?

When it comes to obtaining business capital, an investor is often considered to be one of the best options available. Aside from private business investors, the three major options to increase your business funding include:

  • Family Loans – This usually offers you the most control. It also allows you to expand your capital without involving an unknown party.
  • Partnerships – Taking on a partner can have plenty of advantages, but if you are worried about an investor influencing your control, this is not a viable option for you. After all, forming a partnership may lead to an infusion of cash, but it also gives the new partner(s) direct managerial influence.
  • Small Business Loans – Though this guarantees that you remain in complete control, a business loan can be tricky and you need to make all the necessary payments on time. This can make a loan difficult to manage, especially in industries where profits come in a bit behind schedule.

Like any aspect of business, it is always a good idea to consult with an expert before trying to secure additional capital. A good Boston business attorney will not only help you set up investment terms, but also help you to know what to look for in business investors. When it comes time to plan for expansion of your family business and you wish to seek out the best professional advisers to help explore investor options, contact Jeffrey Cymrot of Sassoon & Cymrot for individual guidance and consultation.

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