Lesson 2 – How to Raise Money Abroad

This message is the second lesson of a course on how to start your own business for a never-ending source of wealth. This lesson covers how to find overseas investors and clients abroad. You can read lesson one here

You can build a small business financed by overseas investors and through cash flow. This has always been Merri’s and my approach, and in early the days of our business I found myself raising extra capital several times. I have also helped numerous businesses raise money to get started. This report shares several experiences to give a thumbnail sketch of how to raise money abroad.

There are two benefits from knowing how to find overseas investors independently. First it gives you access to capital if you need it. Second the process of raising capital from overseas investors is similar to getting customers so this report can help you gain clients as well as seed money from around the world.

Financing a London House through Overseas Investors

This first lesson reviews the importance of flexible thinking in your efforts to raise startup cash through overseas investors. I learned this importance in my attempt to finance a house purchase in London with overseas investors. My business plan was to create a small office-apartment complex and the process of getting started taught me the importance of being creative to get overseas investors.

At first I stumbled when I started asking overseas investors for the money to buy this house. But with luck and flexibility I was able to get the deal done. The search for cash from overseas investors began at a friendly bank who had lent to me before.

While there I learned how policy-oriented such institutions are. Whatever drops down from the corporate headquarters above, is! The deal I had put together was aimed at helping overseas businesses people have an office and a place to stay when they were in London. The deal was set up as a club something like a timeshare. Not quite a timeshare but close enough.

My track record with the bank was good and I had always repaid loans. Yet the policy at that bank was “timeshares are no-nos”. I could almost see the glaze come over my bank manager’s eyes as I explained the project. It was the look that said “No matter what you say, the answer will be NO”. Once a manager thinks that what you want is against company policy, it is better to do something realistic like climb Mount Everest on a lunch break. I come from a family of modest means and had no relatives or friends with the cash to start the deal so my alternative was to find overseas investors.

After making the necessary polite motions [I figured I might want to borrow for something else later] and letting him do likewise, I thanked my bank manager for his time and was preparing to leave. I wasn’t even going to ask him to officially write and say NO. I knew he was going to say “No” before I left his office.

But as I started to leave he said, “By the way let me show you our new American Express Gold Card plan”. The bank had just started to offer credit cards and they came with a 7,500 pound unsecured overdraft. He told me that overseas investors could have these as well as local investors and customers.

Overdrafts are a peculiarly British line of credit that allows you to borrow up to the limit of the overdraft without any regular payment plan. The banker sort of expects to see the amount borrowed rise and fall. The borrower just pays interest on whatever amount is owed and on occasion the bank reviews the overdraft with you.

At that time one pound equaled about 2.2 dollars so this meant that everyone who obtained this credit card received a $16,500 dollar unsecured line of credit. $15,000 was the amount I was charging each member who joined my London office-apartment club! I immediately saw how to use this to attract overseas investors.

I wanted 50 members at $15,000 each which was double the $375,000 I needed to buy and develop the property. I saw how to turn my customers into my overseas investors.

My head was spinning as I left the bank. The bank would not give me a $375,000 loan secured by property. Yet they would lend my buyers of the club the full price of membership on an unsecured basis! All I needed was get half my buyers right now on a nothing down pre -purchase deal. This is exactly what I did. My customers became my overseas investors.

I hustled out, called my customers and offered them this deal they could not refuse. “Join our club now and you get an American Express gold card. The bank will lend you the money unsecured for your club membership. Pay it back when you can.” That was a deal that few overseas investors could refuse.

This was a much better deal for me than borrowing the money from overseas investors to start. The original 25 sales were financed by the bank. My customers had to pay the money back, not me.

From that time forward whenever I think finance, I look far beyond just making a loan from overseas investors. There are numerous ways to skin the “start-up capital” cat and whenever you can do it through sales instead of loans from overseas investors, you are better off. You may be able to obtain credit from suppliers or let your buyers use their credit to get you what you want.

Lesson 3 looks at a financing sources via overseas investors where apartments are turned into cash!

You can increase profits, enhance security and have extra tax and asset protection. Turn your passions into profit. Start your own international business now! Learn how to raise money abroad.

Find out more about our complete course International Business Made EZ at Garyascott.com

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