Funding investors bring strategic benefits of transforming enterprises into a system-driven organization with market synergies
29th July 2021 Ahmedabad: Financial investors bring a lot more to the table than just capital. There are strategic benefits of transforming into a system-driven organization with synergies and new marketing strategies, opined experts at a virtual seminar on “Funding avenues in the changing market scenario” organized by the Gujarat branch of the Indo-American Chamber of Commerce (IACC) on Wednesday.
Speaking at the webinar, Savan Godiawala, Partner, Deloitte said,” Often, due to the lack of funds, businesses are not able to realize their full potential. Funding, however, depends on the stage of the business lifecycle.
Financial structure changes from time to time as the business grows. Funding structure requires proper analysis before making a borrowing request”.
Mihir Joshi, President, Gujarat Venture Finance Limited (GVFL) said that most business owners think that Venture Capital is a way of getting free or easy money, which is a huge misconception.
“A VC brings equity investment and alignment of interests. When you want to expand your business, you need a partner to help scale up because it is a huge task requiring a lot of money and prudence.
The company ends up spending a lot on business development, marketing, and recruitment. Equity investors help bring alignment.” Joshi stated.
Jinand Shah, MD, Online PSB Loans Ltd. stated that a major bottleneck for MSMEs in raising money was to get a loan sanctioned timely.
Implementation of GST became a game-changer for loan processing for MSMEs. Through the online scrutiny process, nowadays, it has become easy and a business owner can receive an in-principal approval of loan in less than an hour”.
Earlier, in his opening remarks, Pankaj Bohra, Regional President, West India Council IACC said, “Many good businesses have fallen flat due to the lack of knowledge on ideal funding sources and capital structure.
While personal savings are always limited, in getting finance from banks, there is always a question of creditworthiness. MSMEs, unfortunately, struggle more for fundraising compared to other businesses.”
Bohra said that despite these struggles, there are several new avenues such as peer-to-peer funding, equipment financing, grants & subsidies, and venture capital.
“From startups to MSMEs, everyone is seeking funds for growth. Businesses have to be ready with solid business plans for raising funds.
Also, businesses have to be willing to let go, and be prepared to adapt to the requirements of angel investors.” said Shailesh Goyal, Chairman, IACC Gujarat branch.
The webinar was attended by members of IACC, industry representatives, academicians, and professionals.
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