Everyone's looking for that San Francisco treat. And what not a better treat then to get funding for that idea and or product you decided to make into a reality. But where do you start? What types of funding are available for you out there and which ones are the right fit for your company?
Traditional sources are though in this economy. To find out which options are still available, EFactor continued its “Got Funding?” series in San Francisco at the new NextSpace co-working space at Union Square. EFactor was joined by three funding experts, Mark Perlmutter
, CEO of Micro Angels Crowd Funding Network, Chris Fure
, Partner and Development Director for Wonder Animation, Inc. and Steve Cinelli
, CEO of Primarq and advisor to Gate Technologies that gave advice about some of the great new channels for funding now available.
Chris Fure kicked off the evening with sharing an overview of where we should be looking for funding. Besides Friends and family, realistic options are Crowd Fund Reward (known as pre-sales), Crowd Fund Equity, Venture Capital or through an i-bank.
A VC, or as Mark Perlmutter called them "Vulture Capitalist", offers often expansion capital to create national channel distributions to which you exit the relationship via a merger or acquisition or i-bank (IPO). Steve Cinelli noted that there are VC's out there that offer more than just money. They provide other services to help you grow your brand, since this will benefit both parties in the long run. Chris also touched on the Crowd Fund Equity part and explained that this is a direct public offer; offering common stock or less than 10% equity of your company has helped small business owners be able to raise money at a reasonable rate.
Guests expressed their fear of VC's taking control off your company. Mark explained that money alone is the gas in the gas tank, you need a driver and that needs to be founder or co-founders.
Mark also commented on the JOBS Act, that President Obama signed into law in April and will allow equity based crowd funding. Right now the big next thing is advertising on NewsFlash! Before equity based crowd funding is being put in effect, direct Public offerings are already legal to advertise. Examples of big name companies who have used this way of advertising are Ben & Jerry's and Annie's Pretzels.
After the discussion, attendees were able to talk to the experts and to get personal funding advice. Once again, big thank you to NextSpace Union Square for letting us use their awesome new co-working space!