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Fueling Extraordinary Business Growth with Minimum Seed Capital

The topic that comes up quite often amongst small and medium sized business is how to invest in growth without access to the capital needed. It seems like a “catch 22” situation, however, it really is not. Unless the business is in drastic decline or near bankruptcy, typically a small amount of seed capital is needed to fuel extraordinary growth combined with a comprehensive and effective growth strategy. The knee jerk reaction to capitalizing growth is usually to raise capital from additional investors, venture capitalists, private equity or to borrow from lending institutions. Most small businesses do not realistically have access to this type of capital, and even though some midrange business might, it may not be the best long term and sustainable solution. A method that is effective and sustainable over the long term, with better long term results, is to start with a minimal amount of seed capital that acts like a spark to ignite extraordinary growth through a staged strategic profit reinvestment and growth strategy. Where does that seed capital come from?  It can come from what your business already has such as uncollected receivables, a line of credit, additional investment by the principles, a portion of near term profits, employee investment, selling assets that are not needed or shoring up operations to yield cost savings. If none of those options apply, then it could come from a business grant (private or corporate grants are available), an SBA microloan, SBA 504 or SBA 7(a) loan. By determining a staged strategic growth strategy and creating a comprehensive strategic plan, the business principles can determine the minimum amount of seed capital needed to fund the first stage of growth leading to the reinvestment of profits into subsequent growth stages. In some cases, no seed capital is needed because current profits can sustain extraordinary growth if reinvested strategically over time. By creating and implementing a strategic growth plan it is possible to start with minimal seed capital ($0-$200,000) resulting in five to six times profit growth, or more, over five years or longer.

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