There are two main sources, other than your own money, where a business can acquire the resources necessary to grow: raising capital from investors or a loan from a bank or other lender. Investor funds can be as simple as friends and family loaning/investing money or as complex as a private equity fund investing millions of dollars.


In order to raise capital from investors, you must follow security laws. These can be intimidating and expensive. Even so, the law must be followed, and failure to do so can lead to disaster in the future. In many ways, these laws can truly provide protection for your company. How complex they prove to be depends a lot on who you want to raise money from. Luckily, much of the paperwork can be done by the business side, which keeps costs down. If this is something you are interested in, please feel free to contact us if you want a walk through the typical documents.


Another avenue to acquire financial resources is through private equity money. This means that a strategic investor or fund agrees to invest money in your company- often in return for a significant percentage of ownership and/or rate of return. This investor will dictate the documents, but it is important to have someone on your side so that you can fully understand what it is that you are signing up for. Failure to do so can result in some serious consequences. For example, we had a very successful client who stood to make little to no money on selling his business because of an unfortunate private equity deal he made during his start up. Again, it is worth the money to make sure that you understand everything in the documents you may be signing. It is better to hire an attorney now and know that your company is safe rather than lose or spend thousands of dollars because of an issue that was overlooked somewhere along the process.


The most traditional route is to obtain a bank loan. For a small flat fee, we can review your loan documents and highlight what you need to know. The kind of language that banks use in these kinds of documents can be confusing. We have represented banks in hundreds of cases and are adept at identifying the language a bank can and will use. Sometimes it is simply a matter of making the documents match reality and understanding the requirements in the loan documents. While repayment is the most important, things such as collateral value, debt to income ratios, cure periods and notice provisions are all very important parts of a loan agreement.