Question 1:
The first significant change or the trend which will influence the future of raising finance is the public relations of the entrepreneur. The main reason is that due to the economic environment, most of the investors is investing in the established and profit making business to minimize their chances of losing. Therefore, for the entrepreneurs, to generate startup finance or to raise the finance to expand the business is heavily relay on their personal relations. For example, if there is an investor in the family, friends or other close relationship, then it is highly probable that the entrepreneur can raise finance quickly on easy terms. (How to make PR and fundraising work together 2016)
Another main change or the trend which will influence the future of raising finance is the private equity funds. The main advantage of the private equity funds is that the entrepreneur can generate funds from the private investors directly or via any investment firm. The main advantage to the investors is to generate income from their investments by investing in the low riskiest businesses. The risk in the entrepreneurship is low because the control of the business is in the hand of the owner. Therefore, the trend of generating finance from private equity funds is of a significant importance. (The Important Role of Private Equity in the World Economy 2014)
The third significant change or the trend which will influence the future of raising finance at the startup of the business is the quality and the strategy in the business plan. The business plan at the startup of the business can create financing easy for the entrepreneur. For example, the best business plan can raise funds via bank or any other investment institute. Therefore, it is very important for the entrepreneur to make a strong, profitable and sustainable business plan to increase the chances of financing at the startup stage. (Ronick 2011)
Question 2:
The public relations of the entrepreneur are the most favorable source of finance for the entrepreneur because it is highly probable that the agreement between the entrepreneur and the finance will be easy for the entrepreneur. Another advantage of using public relation is that the investor can understand the intentions and the future plans of the entrepreneur better than the third party. Therefore, in these circumstances, the public relations, directly and indirectly can assist in the financing for the entrepreneur in the future. Similarly, the public relations in the funds providing firms can help entrepreneur with quick financing. (How to make PR and fundraising work together 2016)
The main advantage of private equity funds is that the entrepreneur generates finance without losing any control over the business and the finance is available at the favorable rates. Moreover, the entrepreneur business which is at the startup or expanding stage usually requires small or medium size investments. The lower level of risks in the entrepreneurial businesses attracts the investors to invest in the businesses. The main advantage for the investors is that they create a chance to buy small but profitable businesses by using small investments. (The Important Role of Private Equity in the World Economy 2014)
Any good business plan can help in the financing of the business. The investors are aware of the potential, movement and the trends in the economic sectors and if the business plan is according to the trends of the market, then the investors will invest in the business at the startup stage. One of the main attractive parts of the business plan is to explain the plan of sustaining and growth of the business. If the business plan is discussing the importance of making and maintaining a customer base effectively, then the investors will invest in the business as compared to the profit oriented businesses. (Ronick 2011)
References
Ronick, D. (2011, July 12). 5 Reasons Why You Need a Business Plan. Retrieved August 13,
2016, from http://www.inc.com/articles/201107/5-reasons-why-you-need-a-business-plan.html
The Important Role of Private Equity in the World Economy. (2014, December). Retrieved
August 13, 2016, from http://www.bakertillyinternational.com/web/insights/the-important-role-of-private-equity-in-the-world-economy.aspx
How to make PR and fundraising work together. (2016, May 3). Retrieved August 13, 2016,
