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Most businesses work with banking, credit unions or other financial institutions for deposits, cash management, trust services or traditional lending. Business credits can be structured in a variety of ways each involving specific terms, conditions and covenants. Banks and other regulated financial institutions are subject to very stringent and continually changing regulatory requirements. Business borrowers should understand and evaluate the technical aspects of the various types bank or institutional institution products and transactions financing for their needs. They should also understand and appreciate the regulatory and best practice requirements that various lenders must follow in order to best position their “ask” and negotiate optimum terms for their financing.
Finance attorneys at The Business Law Group help clients understand, analyze, access, negotiate and structure relationships and transactions involving banks, credit unions and other financial institutions to best achieve their specific business and capitalization needs.
Bank and Institutional Financing Considerations
The Business Law Group has advised clients looking to raise capital through:
1. Crowdfunding (CF) offerings
2. Seed Capital
3. Reg A Offerings
4. Private Placements (Reg D, Rule 506(b), 506(c))
5. Direct Offerings
6. Convertible notes
7. SAFE (simplified agreement for future equity)
8. KISS (keep it simple securities)
9. Convertible Preferred Equity
10. Public Offerings (IPOs)
11. Initial Coin Offering (ICO)
12. Securities Token Offerings (STO)
13. Venture Capital
14. Private Equity
15. Angel Investments
Often the appropriate path for capitalizing a start-up, emerging or high-growth business is to raise equity, convertible or near equity capital. These types of capitalization are complex and hard to access by most businesses. Market intermediaries, investment brokers and gate-keepers can be useful in certain situations.
Transactions in equity securities can be privately negotiated or publicly or privately offered. Online platforms for equity crowdfunding, initial coin offerings (ICO’s) or private placements exist and new ones continually come available. Compliance with federal and state securities laws and regulations is paramount in these transactions. The consequences of non-compliance can kill a transaction, foreclose the business from accessing equity markets in the future and even lead to civil damages and criminal consequences for non-compliant businesses and individuals.
Finance attorneys at The Business Law Group help clients understand, analyze, access, negotiate and structure relationships and transactions with market intermediaries, online platforms and direct sources of equity capital to best achieve the client’s specific business and capitalization needs.
One of the toughest challenges for emerging and growing business is obtaining adequate funding. Getting the right capital infusion at the right time can put a business on the fast track to growth. Post financial crash regulations and best practices applicable to commercial banks and other financial institutions have created an environment where bank or institutional financing is simply not available to start-ups, early stage or fast-growing businesses. In response to this credit market paradigm, fintech (i.e. internet lending platforms) and other alternative financing sources have become increasingly prevalent. These sources are less regulated and more flexible, but unfortunately, significantly more expensive. These sources also have unique “sweet spots” for the type of business and deal terms and structure they are willing to undertake. This is a relatively new area which is not well understood and is hard to access for most businesses. The Business Law Group can help.
Finance attorneys at The Business Law Group are continually researching and interfacing with players in the fintech and alternative finance industry. We help clients understand, analyze, access, negotiate and structure relationships and transactions with fintech and other alternative financing sources to best achieve the client’s specific business and capitalization needs.
Fintech and Alternative Finance Considerations