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While looking for some lending alternatives for a start-up client recently, we stumbled across an innovative new web site. Microventures.com marries social media with the concept of searching for funding, opening up the possibilities to a world of investors willing to help small businesses get off their feet and grow.
On the investing side, the site allows people who have money to invest to sign up. They specify the types of companies they’re willing to consider and the amounts they’re putting on the table. Microventures creates a profile for them that then matches them to opportunities that fit their desired parameters.
For the small business owner, Microventures requires an application submittal with a $100 fee. The application is pretty simple, with a committee evaluating the application for its merit of a second phase review.
If the initial application is approved, Microventures will request a fee of $250 and some additional information: a business plan; financial ratios; financial projections; use of funds analysis; amounts currently invested by owners; pending or current litigation; and a few more details. (HINT: POSITUS is seasoned at working with small business owners to build rock-solid information for consideration by such groups.)
If a small business is approved for listing, there are some additional considerations. First, they must agree to an equity-interest for the investor(s), something that may give many small business owners some heartburn. Small businesses are also charged a fee of 10% of the amount requested if the transaction completes successfully, meaning that all the needed funds are procured through investors on the site.
In a tough lending environment, Microventures.com may be an ideal place for entrepreneurs to go to find the capital they need to establish their businesses and grow them successfully. If you check it out or pursue this concept, please touch base with us and let us know about your experience.
One last statement: Microventures.com did not pay us anything for this article, give us any free seed money, or otherwise be nice to us in any way for promoting them here.