Capital markets facilitate the flow of money to businesses and investments that optimize financial, societal and environmental impacts. Sustainable finance planning is imperative for continued viability in all organizations and applies to all operations. All forms of capital should be accounted for and managed while understanding how sustainability factors impact long term profitability and growth. Strategic finance and capital planning can help accelerate your enterprise to market leadership.
The ability to evaluate corporate sustainability risks from a financial perspective and understanding how to mitigate these risks is also critical to long term sustainability. Our strategic finance practice encompasses the following activities:
- Analyzing and understanding the interactions between growth, innovation and sustainability
- Developing sustainable finance models
- Analysis, and modeling of corporate sustainability, growth and default or bankruptcy risk and
- Developing models for finance governance/regulatory compliance for sustainability.
- Capital budgeting, financing, market and strategy decisions
Strategic Finance is concerned with decision making to ensure the continued viability, sustainability, profitability, and growth of an organization. We develop Strategic financial management plan which details the usage and management of a company’s financial resources to attain its objectives, including maximum value to shareholders, clients and the community. Our advisory platform involves precisely defining a company’s business objectives, identifying and quantifying its resources, devising a plan for utilizing financial and other resources to achieve goals, establish procedures for collecting and analyzing data, making financial decisions, tracking and analyzing variances between budgeted and actual results to identify problems and take appropriate corrective actions.
Finance Planning. Having the right finance strategy is critical in reaching organizational goals. The key is optimizing the cost of capital, maintaining a debt/equity ratio that minimizes risk, and creating a unique financial model that enhances sustainability and growth. Effective FP&A is key to optimal capital efficiency. Often, companies often don’t have time to analyze figures and facts, conduct in-depth process analyses or develop the required finance management models. Call on our experience and knowledge to help with these activities. We are experts in strategic finance.
Raising capital, capital planning, working capital management, investment analysis, project management, and strategic finance can significantly improve the chance of successful business launch, operation, profitability, growth, viability, and sustainability. Our Finance Management Practice involves developing plans to manage an organization’s unique assets and liabilities, including monitoring operational finance items such as working capital, expenses, revenues, accounts receivable/payable, cash flow, investment analysis and profitability. Strategic financial management planning encompasses all of the above, with ongoing evaluation to keep the organization focused and on track for attaining short-term and long-term goals with an overarching focus on maximizing the company’s profitability and value.
The Cost of Capital. The cost of capital is the total amount that a company must pay in dividends on common and preferred stock, and the rate on bonds, expressed as a percentage of the total amount raised through the issue of stock and bonds. This shows what rate a company must pay in order to raise the capital it needs to maintain operations, invest in new projects, and for expansion. The cost of capital is the amount a company must pay for its total funds (required rate of return for both debt and equity), investor’s required return on the company’s securities. It is used to evaluate the feasibility of a business, as well as any new projects of a company. It is also the minimum return that investors expect for providing capital to the company, this is used to set a benchmark of the minimum rate of return that the company has to meet to remain viable.
The Weighted Average Cost of Capital. (WACC) is the average cost of various capital sources both debt and equity after tax. The WACC is calculated by multiplying the cost of each capital source (debt and equity) by its relevant weight, and then adding the products together to determine the WACC value. The WACC is also the minimum rate of return a business must earn on its current assets to satisfy its commitments to shareholders, owners, investors, and creditors. If the WACC is less than internal rate of return (IRR) a business or project may be unfeasible. Sufficient initial capitalization is best achieved through and combinations of debt and equity financing. Determining the optimal capital structure is critical for sustainability. We are experts at assessing the feasibility of business ventures, investments, projects, M&A activities, as well as asset valuation.
OUR FINANCE PLANNING SERVICES
FINANCE AND CAPITAL PLANNING
Corporate funding involves the acquisition (raising) of capital through equity, debt, trade credit, tax incentives, and grants for business operations. The goal of strategic funding is to lower the cost of capital. Corporate financing is a balancing act in terms of deciding on the relative amounts or weights between debt and equity. Having too much debt may increase default risk and relying too much on equity funding can dilute earnings and value for early investors. In the end, capital financing must provide the capital needed to implement capital investments while minimizing the cost of capital. Millennium Management’s Corporate Funding practice advises on and manages Corporate Finance and Funding strategies.
Short-Term Liquidity. Corporate funding is concerned with short-term financial management with the goal of ensuring the liquidity for ongoing operations. Short-term finance management is concerned exclusively with managing current assets and current liabilities, working capital, and operating cash flows. A company must be able to meet all its current liabilities like payroll, fixed and variable expenses when they are due. This involves having enough current assets that can be readily converted to cash like commercial paper, short-term investments to ensure that ongoing operations are funded. Short-term financial management may also involve getting additional credit lines or issuing commercial paper to ensure adequate liquidity.
Many small business owners need sufficient access to working capital with low rates and terms that match the required rate of their business. We developed a unique Funding Program to ensure adequate working capital, inform our clients about all the working capital options and sources available. We source corporate, government and private lending entities to guide our clients to the best working capital solutions at the lowest possible rate to solve short term liquidity problems permanently. Our process is fast and easy, with more than 80% of our clients receiving funding within 10 days.
We cut through the red tape and provide creative, out-of-the box finance solutions. We know the subtleties of strategic finance, sourcing and lending. Our goal is to develop a model for model for sustainable growth, help your business obtain the funds it needs to sustain operations, invest in projects and grow. Our services provide the tools to successfully prepare working capital solutions with 5,000 funding sources including community banks, lending institutions, and private lenders across the nation.
Private Placement. Any business that is needs a minimum of $1M initial capital or is seeking to raise funds for expansion should consider equity or debt funding should conduct a private offering. Under the Securities Act of 1933, any offer to sell securities must either be registered with the SEC or meet an exemption. Regulation D contains three rules providing exemptions from the registration requirements, allowing some companies to offer and sell securities without having to register the securities with the SEC under Rules 504, 505, and 506. Raising capital under Regulation D can significantly increase the chance of a successful new business or product launch and reduce the cost of capital needed to successfully launch or expand a business.
Investor Partnerships. We partner with over 5,000 funding sources worldwide, prepare all SEC related documentation, and negotiate with investors to conduct the private placement. We design funding strategies, provide funding sources, assist with negotiations, form and register businesses. Private Placements are regulated by the U.S. Securities and Exchange Commission, and the U.S. Treasury Rules governing Private Lending Sources that lend money to and invest in private companies. Investors in private companies include angel investors, trusts, banks, foundations, corporations, and investment funds.
Raising capital for operations includes consideration of capital structure, average cost of capital debt/equity ratio, traditional and non-traditional sources. For small businesses debt financing may be cheaper because of the tax deduction but may be limited by the company’s asset base. Equity financing allows greater income flexibility for investors with greater potential for returns, and capital gains. An equity financing allows access to more capital through SEC regulation D. We can assist in examining your capital structure to develop a unique financial policy designed to fit your specific enterprise.
Inadequate initial on ongoing capitalization failures include unfeasible business plans, inadequate market plans, lack of strategic Financial Planning & Analysis, and insufficient infrastructure to support growth. With over 30 years of experience in the financial and legal sector, we help navigate this highly complicated, intensely regulated sea of technicalities
Funding for growth, operations, marketing, and infrastructure is vital to the viability of an enterprise. We can assist in difficult financing situations, or where other efforts have failed. Many small to medium sized businesses lack sufficient access to the capital they need to fund operations or grow. We provide management consulting and financial advisory services for enterprise viability and sustainability. We work with our clients to identify, source, structure and execute diverse and innovative finance transactions.
Companies go through various finance stages before the liquidation stage when investors cash in. Stages start from seed capital and private placements all the way to IPO – Initial Public Offering. We help with all stages of funding, matching investors whose preferences match your company’s stages along with other important preferences Provided you have sufficient business, financial, and marketing plans we can source investors quickly without the tedious networking required to attract private capital. Business, finance, and marketing plans are drafted or reviewed for sufficiency before submission to investors.
Seed Stage The seed stage is the very first stage of a company. Seed stage is usually the stage of a company that is just beginning and may not have a product prototype yet.
Early Stage This stage describes a company that is still in its formative phase. At this stage, a company may have a product prototype or may be developing its prototype. Early stage or startup stage is usually divided by different funding series. These series are series A and B. Series A is usually the first round of funding in early-stage funding. This round of funding is usually earmarked for getting the product or service prototype developed and prepared for mass production or implementation. Series B basically describes a round of early-stage funding that is earmarked for companies who already have a fully developed prototype and is at the stage where their product prototype can be manufactured. This funding round usually provides the capital to hire more staff and workers, prepare facilities for mass production, and finally allow the company to open for business.
Growth or Expansion Stage is usually referred to companies who are already established and already have an established clientele with cash flow therefrom, and a growing revenue based. When a company reaches this stage, it is usually already doing well and needs to expand.
Mezzanine Stage is a stage that a company goes through as it prepares itself for an initial public offering (IPO) to have its shares publicly traded on one of the Stock Exchanges.
Liquidation Stage is usually the phase of a company’s life where the investors make their exit and cash in on their investments. Liquidation can be divided into different kinds of stages, such as mezzanine stage, managed buyouts, and leveraged buyouts.
Managed Buyouts are usually when the management of a company works together with investors or the management of other larger companies to buy that company.
Leveraged Buyouts are when investors who have a controlling share in the company leverage the buyout.
Many small businesses with an annual revenue of $1 million or less experience difficulty with working capital and acquiring capital for growth. 41% of small businesses report that they cannot obtain adequate financing for growth. Our services help source, reduce the cost of capital, restructure finance, develop working capital plans, investment strategies, and plans for long-term sustainable growth.
As a growing portion of the nation’s banks saw a spike in demand for loans to smaller firms according to the latest Federal Reserve figures. The second quarter of 2021 saw 26% of banks experience “moderately stronger” demand for commercial and industrial loans from small firms earning up to $50 million USD. That percentage was the highest all year, rising from 8% the previous quarter. The data is consistent with an uptick in business confidence. With the uptick, nearly all banks surveyed kept their credit standards tight, and their loan terms the same due to increased risk control because of the financial crises.
Even with the moderate recovery and increased demand for loans, the vast majority of banks kept credit tight, as 94% reported that credit standards for small firms remained basically unchanged. A similar proportion of banks said the maximum size of credit lines and requirements on collateral also stayed the same. Many small businesses have some difficulty with working capital and access to capital for growth.
Talk to us about finance strategies for finance, optimizing the cost of capital, working capital management, asset optimization, and maximizing return on investment. . We provide technical implementation for all planning initiatives to satisfy GAAP, SEC Regulations, Investor Relations, financial reporting, feasibility, profitability, income, financial statement, and ratio analysis.
Whether you need capital for investment in PPE, working capital, or short-term liquidity, contact us to discuss your plans. Book a strategy session or apply for funding: