The Best Business To Do

There is nothing like a silly question. We provide some answers to common questions we are asked. If you have any further questions, ask us. 

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1. What is Venture capital? 

Funding available primarily for start up companies. The venture capitalist usually takes a % of shares (instead of collateral) and expects to exit in say 5-7 years from the company.

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2. How about Private Equity? 

Funding available primarily for established business to grow to the next level. The private equity fund also takes a % of shares or might also offer debt or a combination of both.

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3. What is Equity? 

A % of shares in a company that represents its share capital. 

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4. How do I write a good business plan/proposal? 

Experienced investors will tell you that certain key information needs to be included before they can even turn the pages. One of these is an executive summary (investors are busy and read many plans). They will also tell you that they are quite keen to know what the applicant has done to date. How about the team? Does it matter? Yes it does! These are some of the key ingredients of a good business plan. Read in advanced thinking our NED's tips on mistakes to avoid when writing a good business plan.

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5. In which business sector should I go to? 

This really depends on a number of factors as there are several sectors and businesses but two key factors to consider are:

a) Passion. it is key to go into businesses in areas of specific interest or passion to you. Business is generally a mid-long term activity and so if you focus on such areas of interest to you it means you can carry on, when the going gets tough (and it will).

 

b) Risk appetite. Some people like danger, others like to play it safe.  In choosing where to invest, consider your "risk appetite" whether it is say low risk, medium risk or high risk.

 

That said and done, you can see our ranking of best sectors for business above.

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6. What is Return on Investment (ROI)?  

This a measure of how quickly (or successfully) you can get your original capital(equity) investment from the profits of a business. It is measured as net profit/total equity or investment. If for example your initial capital was $1m and your profit was $. 5m. The ROI is calculated in one of two ways:

 

(a) No. of Years: Capital investment/Profit* 365 = $1m/$5m*365 = 73. Means you get your investment back in 73 days which is about 2 and half months.

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b) As a percentage: Net profit/Investment*100= $5m/$1m*100= 500%.

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7. Are audited accounts really important?

For a start up company with limited funds and being typically managed by its owners, it might not be so important to have audited accounts. However for a company that is growing and is hoping to expand in the future say via venture capital, private equity or loans then it is almost a necessity that you will need to have audited accounts. Many lenders or financiers will want to see 3 years or more of audited accounts and so we would highly recommend that if you expect your business to be growing you hire an auditor right from the start.

 

By audited accounts we mean financial statements that have been assessed by a certified public accountant (CPA) on whether they are "true and fair". In the US, CPAs are regulated by their respective states and then they are organized in an umbrella body called the AICPA. 

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8. What does Inachee mean?

This a combination of words to represent the spirit of what we do:

(i) Inertia from the physics term to describe the tendency for an object to remain in a state of rest or motion unless acted upon by an external force

(ii) Chi from the Chinese word for internal energy

(iii) Inach from an African language (Iteso) and their word for sister.

 

In summary, we represent the following spirit: "Brother/Sister, let us work together (ethically) to change the world of business.

 

9. What can Inachee do to help my business succeed?

Our core work covers:

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• For Start ups/new business ventures - Feasibility studies and Business plans  

• For Growing business - advisory on financing options (financing readiness), audit readiness advisory and various advisory services. 

• Other services. Financial modelling and fractional CFO services. 

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