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Expert Advice Series: Fundraising Concepts – Lesson Five

Expert Advice Series: Fundraising Concepts – Lesson Five


[TEXT: Expert Advice Series] [TEXT: Fundraising Concepts] [Peter McFarren:] If you’re joining me, then you know I am Peter
McFarren and this is Fundraising Concepts. I trust that you’ve made it through each of the lessons in this
course: fundraising strategy and plan, marketing and communications plan,
and funding opportunities for non-profits. Our final stop is funding opportunities in the for-profit sector.
[TEXT: Funding opportunities for for-profit businesses
or organizations] There are a wide range of funding opportunities for profit-making
institutions, depending on their financial and legal structure and line of
business. These can involve equity investments by individuals, angel
investors, multilateral organizations as well as business incubators. Most financing institutions will want to see that you have made your
own financial investments in your project. They’ll want to see a solid business plan and a manageable
debt-to-equity ratio. That means your cash flow must show that you are able to cover your
debt, pay for capital and operational expenses, and have funds left over to provide a return to an investor. Take a close look at your debt-to-equity ratios, your cash flow, the
interest you will pay on a loan and the expected returns. Make sure debt is manageable. Consult with professionals like lawyers and accountants if you can. Be sure that the reality of your company is in line with the
expectations of an investor. In some cases, an investor will require guarantees. Make sure they are realistic and will not suffocate your company. You must also evaluate and manage the monetary and political risks associated with your company or project. For example, if there is a devaluation and your loan is pegged to a
foreign currency, will this limit your capacity to pay off your loan? Be smart about managing your risk. Joint ventures are another useful vehicle for bringing in capital to your organization. Investments through incubators or micro-credit organizations are
other options, depending on your financing requirements, size and sector. The advantage of a joint venture is that it can bring in financing, technical and managerial skills to your organizations and provide the groundwork for an eventual partnership. Raising resources involves hard work by a committed,
multidisciplinary team. It requires looking for opportunities, creativity, patience and
persistence, managing risks, and knowing when a chosen path is viable and when
changes need to be made. Fundraising is not a science but a process. Stand ready to adjust that process as the reality of the project
changes and new opportunities open up. Your plan should be innovative in nature and flexible in design to
accommodate fresh approaches or methodologies. At the same time, recognize the limitations of the plan. The experience and the passion you feel for your work will help you
overcome many obstacles so your efforts will bear fruit. Regardless of what type of company or organization you create, knowing how fundraising, grant distribution and philanthropy have
changed in recent years positions you to move forward with confidence. Keeping abreast of the latest trends in fundraising places you on
the forefront of opportunity. Investing in your team members through professional development Remember, investors want to know how their resources are invested
and how they will make a difference. You must demonstrate that your idea is viable, innovative and
sustainable. If you reach a wall, find a way to climb over it or go around it! As more people believe in and support what you do, the greater your
impact and success will be. Step by fundraising step, you can make your dream come true and make
a positive impact on your community. Thanks for joining me. [TEXT: Expert Advice Series] [TEXT: Produced by the U.S. Department of State]

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