What to Consider When Assessing What a Family Business Will Need to Grow and Succeed
Changes in business dynamics are occurring rapidly, with businesses recognising and feeling the need to move fast to acquire technology or enter new regions and service lines. Family businesses are increasingly attracting investors’ interest because they make up a large portion of the economy and often do not have the necessary financial resources to survive or grow.
For many businesses, an increase in funds can accelerate their business development plans, both in the short and long term. That might mean deploying capital to organically grow in existing markets, adding staff and building new facilities. It also might be funding more ambitious plans, like acquiring a competitor, entering new markets or developing new product lines.
The good news is that family businesses can be attractive to investors as they are seen as more stable during economic downturns, transitions and expansions; which means a mature family business might be poised for venture-backed growth. Even without previous financing, a well-established family business can use a strong financial history to present a solid case for a capital investment or loan.
Questions to consider when assessing what a family business will need for the future:
- What capital needs will my family business face in the near and long term?
- What are my options for securing capital? What non-traditional sources have we considered?
- What trade-offs (if any) is my family business willing to make to secure capital?
- Is it important to find a funder who can bring more to the table than capital, in terms of advice and guidance about my business?
- Do we have enough financial flexibility and access to capital to weather a significant economic downturn?
Finding the right source for funding your family business will secure the capital you need to maximise business growth and ensure your business is sustainable for generations to come.
Talk to an Advivo Accountant, today to see how we can help your business work smarter into the future.
YOU MIGHT ALSO BE INTERESTED IN: