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Business Growth Driver #5 - Finance - YouTube
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hi there welcome to business growth
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driver number five finance absolutely
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finance can help you grow your business
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so I'm gonna cover two specific things
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here number one why do you want to get
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finance external finance to fund your
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growth and number two what sort of key
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things do you need to have in place to
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be able to attract the right type of
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finance so the first thing why do you
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need finance to grow you need finance to
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grow in a number of different ways you
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could be looking to expand into new
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market you could be looking to acquire a
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human capital and get the right talent
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in place you could be looking to develop
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new products or services or you may be
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looking to expand the reach through
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marketing so finance is required in
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terms of that and that can really help
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accelerate the growth of a good company
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okay now let's get into how do we
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attract finance and particularly what I
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want to talk about is private equity
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private private equity is when a company
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lend you money
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a group of finance hears and they take a
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shareholding in your company so they're
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invested in that particular way and this
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is the DNA money from this week and it's
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showing here that P back companies
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outperform you know various companies on
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the Sensex listed companies etc and
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they're able to show that you know the
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revenue growth of P back companies over
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a five-year period is 40 percent as
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opposed to just 18 percent for the nifty
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mid-cap or just 15 percent for long pbot
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listed companies the asset growth is
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also 46 percent higher compared to just
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16 percent with non PE back listed
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companies and 18% for Sensex companies
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so private equity can really play an
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incredible role in helping you grow your
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business further and there's some key
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elements that you need to have
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place to be able to attract private
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equity to your business the first thing
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I think it's really important to get the
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right mindset in place and grow and
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treat your business like you're going to
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sell it and that way what will happen is
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you'll set up the processes and etc in
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place that will help your business grow
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professionally and work without you and
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you'll have made up your mind that yes
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you are willing to give away a little
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bit of control and shareholding and
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that's an important part so that's the
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first part the second thing which is
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important is you need to have a strong
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corporate finance team and this is where
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getting the right human talent is really
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important you need to have strong
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financial discipline in the way that
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everything works there needs to be clear
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transparency as well and a good strong
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solid team can help you get all of those
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particular things in place lenders want
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to know that they're getting accurate
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information they're able to help you
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move the business forward the third
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thing is to make sure that you both have
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strong cash flows and profitability it's
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not just good having profitability by
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itself
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they say the revenue is vanity and
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profit is sanity so it's really
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important that you have strong cash
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flows because the P firm is going to be
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giving you the money based on future
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cash flow so it's important to have
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strong cash flows in place and you need
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to have a business model that is able to
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generate that in lastly you want to make
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sure that there is strong governance
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there's strong controls in place and
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there's transparency in the way in which
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your company operates there's nothing
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that will make a investor more concerned
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than you know people not being
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transparent so it's really important to
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have good strong governance and
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transparency in place so that you're
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able to attract the right finance so
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that you're able to grow
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like sharing comment below how are you
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looking to fund road and what are you
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looking to fund growth for
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