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The Differences between Debt, Equity, and Venture Capital

You may have heard of financial terms like “private equity”, “debt capital”, and “venture capital”. Those are all terms that managers like Sun Capital Partner’s Marc Leder deal with on a daily basis. All of those terms refer to investments, and there are some key differences between them. It is important to understand those differences if you are an entrepreneur, so that you know which one will be most applicable to you.

Debt Capital

Debt capital is very closely related to a bank loan, which is one that is repaid with interest. Debt financing is common with new entrepreneurs who need startup capital. This is why most will go to a regular bank, although investment banks exist for those who require very large sums of money. The investor who provides debt capital does so because this is a low risk type of financing, particularly when compared to private equity. This is because the money is borrowed to you, in the same way as a mortgage or car finance. The interest rates vary, although an investor will usually want to see at least a 10% return on the money they received. There are usually stringent time limits attached to this as well.

Private Equity

Private equity is very different because you don’t have to pay it back to an investor. Rather, it looks at the money that is in a business, collected through growth. Usually, it comes from an equity fund owned by high net worth individuals who look at ways to grow not just their own capital, but the economy as a whole as well.

Venture Capital and Private Equity

Private equity comes from private individuals or institutions owned by private individuals. Usually, these individuals are people who have a great deal of financial experience, including institutional investors. Venture capital is very similar to this, but it is generally only provided to companies that they can prove they have high growth potential. Venture capital, in a way, is less risky than private equity, in other words.

Anyone who approaches people like Marc Leder, or firms like Sun Capital Partners, must do so with a well-thought through plan. While debt capital is usually the easiest to obtain, it is also the most expensive and generally in the lowest amounts. Venture capital and private equity will give you far more chances of really experiencing growth because, firstly, the money involved can easily reach millions of dollars and, secondly, because you will have the financial expertise of people like Marc Leder behind you. However, because these financial investments are more high risk than debt capital, they are also more difficult to obtain and competition is fierce.

In order to be considered for venture or private equity capital, you have to be able to demonstrate that you are better than anyone else. You must be able to show that you have an excellent management team and a clear strategic direction. Essentially, you have to be a profitable, established company that is looking at a way to grow even bigger.

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Types of Fences for Front Yards

We are going through a huge boom of home improvements at the moment and everyone seems to be getting in on the act of improving their house or garden. Why not? We have spent enough time in them over the last year or so. The first impression people tend to get from your house is the fence for your front yard. All of your home and garden improvements can have a cherry on top by purchasing a practical and new looking fence. Below I have included different types of fences that will help you make your decision.

Timber Fences

If you are interested in purchasing a new fence, the first thing you will need to think about is what materials you would like for the fence itself. The most popular options tend to be timber fences and the type of timber is something you need to consider based upon your budget, how long you ideally want your fence to last and how big you want your fence to be.

A timber fence is most people’s go to, it provides the privacy and restriction needed whilst looking the part. It is a lot easier to customise compared to other materials also, in terms of timber fences Australia really likes to get creative. White or brown? Not necessarily, give your fence a snazzy look by painting it whatever colour you like. Wooden fences do tend to take longer to fit but worth it in the long run as it holds a long sturdy life expectancy.

PVC Fencing

PVC Fencing is an option if your budget is forcing you out of other materials. Granted it isn’t the sturdiest of options for fence material but it does the job that it’s supposed to. The cost is reduced as there is less timber being used on the fence. The PVC sleeves are attached on top of wooden posts and still come in a variety of colours and sizes. Definitely an option for you if price comes into play.

Wrought Iron Fencing

On the other scale of fencing, a pricier option is wrought iron fencing. Coming in many alternative designs, iron fencing offers beautiful and extremely strong fences that will draw the envy of your neighbours. The image and strength also provides a high level of security to your home. The down side of iron fences compared to say timber fences is that they have a fairly high level of maintenance to keep its aesthetically pleasing image.

Chain Link Fencing

This may not be the most aesthetically pleasing fence but a chain link fence can be extremely practical depending on your home or business. The privacy and security they provide is pretty much nonexistent, however they are very low cost, durable and are very low maintenance. It really does depend on what is needed and what you prefer for your home.

And Finally…Get Quotes

If you are still unsure about what type of fence to get, speak to professionals and get a quotation. They will ask you questions about the purpose of the fence and will be able to help point you in the right direction. Typically when it comes to timber fences Australia has various options on what works best for you. Most importantly you will be able to get that all important price.

Why You Need a Carport

Carports are a very popular option for car storage and today we are going to take a look into exactly why this is a construction which you should consider. 

The term carport originally was used to refer to a passageway through which cars would travel through upon entering a building. Genius architect Frank Lloyd-Wright saw something else in this external construction however and since his own interpretation, the carport has grown in popularity and evolved in its design. When it comes to carports Melbourne is full of them, because residents here understand the range of benefits which can be found after building one. 

These lean-to or independently built structures outside the home provide the perfect place to leave your vehicles, and here are just some of the benefits of building one. 

Protection From The Elements 

The key benefit of a carport is to protect your vehicles from the elements. In some cases this means not having to scrape frost and ice off the car in the morning before work, in others it means protecting it from any damage which hail can cause. To most of us in Australia these conditions aren’t much to worry about, but searing heat and flying debris could be, both of which your car will be protected from with a carport. 

Security Increase

Many believe that the car is not any more secure in a carport, because unlike a garage there are no locks or doors. With this being said studies have shown that vehicles stored under a carport are significantly less likely to be stolen than those which are not. Additionally insurance companies may offer a discount if your car is being stored in this way. 

Adding Value 

Carports are considered an attractive feature amongst property buyers, and building one could in fact add some value to your home. Broadly speaking 30% of the spend which you make on the carport, can expect to come back to you when you eventually sell the property

Aesthetically Pleasing 

Thanks to the smart designs which we have, as well as the bespoke options which you have to choose from, a carport can really make your home look more attractive. This adds a simple structure to your property which will help to continue the theme of the home and make the entire place feel more homely and comfortable. 

Low Cost Garage Alternative 

Many would like to have a garage on their property but if there isn’t already one there, the construction of a garage can be expensive. Even if you opted for custom carports, you will find that the overall cost pales in comparison to building a garage on site. 

Planning Permission 

Many fail to realize that they would need planning permission for a garage, which may not always be easy to obtain. Because of the simplicity of the structure and the fact that utilities aren’t required however, the construction of a carport very rarely needs permission — as it is filed under the same category as an external shed. 

This is a low cost and low effort way to make sure that your vehicles are safe, and that you add some value and attraction to your property.