You are looking for solutions for finance the takeover of a business ? How and where to find money?
To take over a business, you need the necessary funds. We offer you an overview of the different means available to you.
Financing a business takeover with own funds
It is often the first solution that we think of. It's not just a way to quick financing because no third party is solicited but it is also a way of showing that investing in this company is particularly important to you.
Be careful, however, not to invest all your assets! Indeed, this money is not refundable. Although no rule is written, it is estimated that this personal contribution must amount to 20 to 35% of the redemption price.
The entourage
When we do not have the necessary funds to finance a business takeover we can also ask thehelp from relatives (friends and family in the lead). They can participate in the project in different ways:
- thanks to donations,
- loans,
- with participations in the capital of the company
Note, moreover, that individuals who invest in companies can benefit from tax advantages.
Crowdfunding and investments
You don't have enough money to finance your project so why not join forces to raise the necessary funds? The idea is therefore to create a parent company which will own all or part of the structure being taken over. In short, capital is open to outside investors.
The necessary funds will in this case be collected through crowdfunding (better known as crowdfunding), business angels or investment funds.
Thanks to public aid
The State, regions, departments, municipalities, the European Union and even certain public establishments can help you to finance the takeover of a business.
Obtaining an honor loan
Thanks to support networks, you can also benefit from an honor loan. This type of loan is made without collateral or personal surety and generally at zero rate. In addition, it is registered as equity.
Use a loan
When you have gathered your various own funds, the necessary additional financing of the business takeover can also be done through a loan.
Moreover, obtaining it will be made easier to the extent that you have shown perseverance and resilience in raising funds by your own means. The credit then becomes a support for the previous steps.
There are three types of credits:
A classic loan
This credit for finance the takeover of a business is done with a bank. If you take out a loan from a banking organization, it will certainly ask you for guarantees also it will be necessary to add personal guarantees, mortgages, pledges of business funds or social shares.
The seller's credit
The case arises when the transferor grants a loan to the company taking over. This solution is often used when the buyer and the seller know each other well enough.
It is also only possible if the transferor does not have an urgent need for money. In addition, this type of loan can also be useful for obtaining traditional credit from a bank. Indeed, it demonstrates the confidence shown by the transferor towards the transferee of his business.
Bpifrance
Bpifrance (Banque Publique d'Investissement de France) offers a transmission development contract for SME takeovers. This is a loan of € 40,000 to € 650,000, without guarantee or personal guarantee, always backed by a bank loan. It can reach a maximum of 40 % of all the loans put in place.
Similarly, this organization can guarantee your bank loan up to 50 % (or 70 % with the intervention of the region), for the takeover of an SME.
