Tuesday, March 6, 2012

From prototype to international business - Morgan Cradock

How do you raise capital for an international business opportunity if the domestic opportunity is consuming cash?

  1. Firstly, unless you have the vision to recognise that you do have an international business opportunity, you wont have one.
  2. You need to understand the business model inputs that drive the long-term growth in the company?s valuation.
  3. Finally, you need to calculate the funding required to set the domestic platform up for success and communicate this to financial partners in the context of the larger international business opportunity.

For a light or heavy industrial company the proof-stages might be as follows:

In our experience, the best way to communicate the opportunity and put forward the business case is by way of a detailed financial model. Our models aren?t simple 3-way forecasts that an accountant might put together. And nor are our financial spreadsheet models a simple project return on investment calculator with broad assumptions.

Our financial models are management tools for making decisions specific to our client?s business model and with regard to the likely transactions they will need to undertake in the short to mid-term. We provide strategic advice to help our clients think through the options that might exist for accelerated growth. Our financial models will then be used to assist us and our clients with negotiations between existing and new investors, and with any new sales channel partners and manufacturing licensees. We can ?run? scenarios of how we think the negotiations will play out, before our clients have even entered into the discussions.

Our financial models help our clients determine what to offer shareholders, investors, and business partners.

?I was extremely impressed by the strategy consulting sessions that Michael undertook for my company, the Biofuel Partnership Limited, at our head office.

My co-directors and I were extremely pleased with the way that Michael worked to draw out and identify our extremely complex issues, and led us to more fully understand the true options that we face in moving confidently into the future.?

Harold Abrahams, Director
The Biofuel Partnership Limited



About the Author

Michael Cradock
Michael is a corporate finance advisor with a chartered accountant and management consulting background having worked for both KPMG and PricewaterhouseCoopers. Michael is an owner of Morgan Cradock and part-owner in two startup companies and one property fund.

Source: http://www.morgancradock.com/blog/2012/03/05/from-prototype-to-international-business/?utm_source=rss&utm_medium=rss&utm_campaign=from-prototype-to-international-business

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