Being able to realize one’s idea, expand a small business, or grow the capital assets of a company are three distinct challenges in their own right and can be difficult to accomplish. Early stage equity funding can help a small business with this particular obstacle.
The need for early stage equity funding is meant to help overcome roadblocks that generally pop-up for start-ups, where a business idea is viable and the demand is there but the capital to reach that target market is lacking. The equity funding that can be furnished by middle-market investors can support the short-term business goals of gaining sales or reaching a certain milestone.
Early stage equity funding can be considered in the following way; equity funding is contributed very early, almost at inception, and can also be considered “seed money.” Seed funding usually comes from the promoter or family/contacts/friends as it is important to prove the idea/concept (the idea here being that if those close to you don’t trust this business venture, who will?). Once “proven” and seen as ready to gain sales there is a need for additional early stage funding to allow for production/ distribution/ commercialization/ etc. and this is know as the First Round of Funding, or early stage equity financing.
Always make sure that you make an informed decision in all cases,
All the Best,