3 Mistakes On How To Make Money Online

In this 21st century era, the internet has taken most of the big businesses trading around the globe. It is no doubt that making money online is booming real fast. What used to be deemed by the society as fraud, scheme… etc all sorts of negative impression on the internet has now been replaced by praises. The internet has enable people to escape the 9-5 job routine and create their own online business.We have heard many people are earning a lot of money from the internet. Make money online has been a dream for many since then. Whatever their end desires are, it can be summarized as below on why people what to start an online business and make money online.1.) They own the business. No longer need to repeat the same old 9-5 routine.2.) Earning margin is unlimited. There is no limit to how much you can earn online.3.) Enables you to reach to audience of worldwide.With all the benefits above (and more!), it is no wonder more and more people are looking into making money online.However, the real question hits everyone who wish to start an online business real hard. The question is: How can I start to make money online then? The moment people ask this question, a sense of fear immediately arises in their blood. It is because they have never done anything like that before, and have all the pre-conceived notion on what the online business is.Here are the 3 mistakes that you need to avoid when it comes to build your own online business and start to make money online.Mistake number 1 – You need to be extremely good at programming and coding in order to make money online. Doom is the age of alien languages, now is the era of drag and drop! To build an online business, you don’t need to know even a single line of code. Many times people have been told that to start an online business you will need to at least master the foundation of programming and all the technical knowledge. Truth and the good news is, you don’t have to! With all the technologies in place now, you can even create a website in less than 30 minutes without facing the alien languages.Mistake number 2 – Sell service. By selling service you are exchanging time for bread. You can’t pull yourself out from the equation when you sell service. Simply put, you stop earning money online the moment you stop working online. Make sense? The better way would be to sell information digital products. Not only it’s earning margin is high, you can put it in automation as well. That means you can earn money even when you are away, even when you are not managing the business.Mistake number 3 – You need to get a Master Degree in designing a website. Scrap this. All you need is a good course that teaches you the right way of doing marketing online to drive traffic to your site. Let’s face it, without traffic, your beautiful website will be rendered as useless. It is because no one is looking at it! Marketing is the important puzzle that gives you revenue, not the look of the website.With these 3 mistakes to avoid, you can literally be relief to start to make money online. As long as you put the efforts in it and be patience, you will see result. Build an online business and make money online are real. Don’t be chickened out by those deceiving 3 mistakes!

Save Money on New Cars by Buying Through an Auto Auction

With the state that the economy is in these days, everyone is looking to save money. It only makes sense that people want to save money on one of the biggest purchases of all – and I am not talking about a house (though there are auctions for houses now, too) – I’m talking about the purchase of a car. Although the prices of cars are going down due to an excess of inventory (since not many people are buying from the dealers currently), despite the lower prices, many people are still not buying the cars direct from the dealer.Instead, folks are finding out that auto auctions offer a plethora of cars for a steal of a deal. The old way of obtaining cars at auctions for low prices was to attend a live police auction. While this is still a good option, the best option nowadays is to look at online auto auctions. Dealers are wising up to this and placing a lot of their overflow stock or inventory that hasn’t sold onto the online auctions. Thus, the choices are many for the consumer who wants to save money by buying a car through an online auto auction.By far, the most popular online auto auction is through eBay Motors. EBay is a reputable online auction site, free to join, and the most well-known auction site throughout the world. Let eBay’s popularity help you out with your search. When you are searching for a particular car, if it is listed on eBay, it will most likely show up in the search engines. Do your homework on any car that you wish to buy, though, to make sure you know what the car is worth, the car’s specs, what is included, etc. so you won’t be ripped off or sold a “lemon.” Many of the cars listed on eBay are sold through both used and new car dealers, as well as individual people. There are several other good online auto auction sites that are also free to join.A simple Google search will reveal some of the top online auto auction websites, and they are all free to join or register. The top result is I Bid Motors (ibidmotors.com), a huge online auto marketplace that advertises itself as “the better way to bid for cars online.” The cars are listed by make and model and by premier dealer; you can also save a list of your favorite cars, to keep an eye on the auction. Another popular auto auction website is Capital Auto Auction (capitalautoauction.com), which is the official site of auto auctions for the Salvation Army. This auto auction site is full of cars that are listed for auction below one-thousand dollars. There are several physical locations throughout the US, and you can find a list of locations on the website.They also have a live online auto auction every Saturday, done from each Capital Auto Auction physical location. Registration is free with the Capital Auto Auction website. Another top choice for an online auto auction is Motobidia (motobidia.com). They offer free membership, a nationwide selection of cars, a free vehicle history report included, wholesale car prices and free shipping nationwide, to name a few perks. Also, if you refer a friend or family member who signs up and purchases a car through Motobidia’s online auto auction, you receive a one-hundred dollar referral bonus. Both saving money on your new car and earning money for referring their service – you can’t beat that!No matter which online auto auction you choose, as mentioned previously, you should always do your homework and research the car you want to buy. Some online auto auction companies, like Motobidia, offer a free car history report with your purchase. With others such as eBay Motors, it depends on the seller as to whether or not they offer a free history report. If not, don’t worry – you can always go to Carfax.com and order a vehicle history report on your own. In order to do this, you need to obtain some vital information about the car, such as the VIN (vehicle identification number), and the year the vehicle was made. If the car you are planning to bid on happens to be local to you, go to the physical auction site and check out the car. Bring a mechanic or someone knowledgeable about cars with you to help you check the car for problems and defects. Be sure you know just how much the car is worth, so as to avoid “being taken for a ride,” so to speak.All in all, this information age that we are living in is a very exciting time, and a great opportunity for those looking to save money by buying a car through an online auto auction.

Revenue-Based Financing for Technology Companies With No Hard Assets

WHAT IS REVENUE-BASED FINANCING?Revenue-based financing (RBF), also known as royalty-based financing, is a unique form of financing provided by RBF investors to small- to mid-sized businesses in exchange for an agreed-upon percentage of a business’ gross revenues.The capital provider receives monthly payments until his invested capital is repaid, along with a multiple of that invested capital.Investment funds that provide this unique form of financing are known as RBF funds.TERMINOLOGY- The monthly payments are referred to as royalty payments.- The percentage of revenue paid by the business to the capital provider is referred to as the royalty rate.- The multiple of invested capital that is paid by the business to the capital provider is referred to as a cap.CASE STUDYMost RBF capital providers seek a 20% to 25% return on their investment.Let’s use a very simple example: If a business receives $1M from an RBF capital provider, the business is expected to repay $200,000 to $250,000 per year to the capital provider. That amounts to about $17,000 to $21,000 paid per month by the business to the investor.As such, the capital provider expects to receive the invested capital back within 4 to 5 years.WHAT IS THE ROYALTY RATE?Each capital provider determines its own expected royalty rate. In our simple example above, we can work backwards to determine the rate.Let’s assume that the business produces $5M in gross revenues per year. As indicated above, they received $1M from the capital provider. They are paying $200,000 back to the investor each year.The royalty rate in this example is $200,000/$5M = 4%VARIABLE ROYALTY RATEThe royalty payments are proportional to the top line of the business. Everything else being equal, the higher the revenues that the business generates, the higher the monthly royalty payments the business makes to the capital provider.Traditional debt consists of fixed payments. Therefore, the RBF scenario seems unfair. In a way, the business owners are being punished for their hard work and success in growing the business.In order to remedy this problem, most royalty financing agreements incorporate a variable royalty rate schedule. In this way, the higher the revenues, the lower the royalty rate applied.The exact sliding scale schedule is negotiated between the parties involved and clearly outlined in the term sheet and contract.HOW DOES A BUSINESS EXIT THE REVENUE-BASED FINANCING ARRANGEMENT?Every business, especially technology businesses, that grow very quickly will eventually outgrow their need for this form of financing.As the business balance sheet and income statement become stronger, the business will move up the financing ladder and attract the attention of more traditional financing solution providers. The business may become eligible for traditional debt at cheaper interest rates.As such, every revenue-based financing agreement outlines how a business can buy-down or buy-out the capital provider.Buy-Down Option:The business owner always has an option to buy down a portion of the royalty agreement. The specific terms for a buy-down option vary for each transaction.Generally, the capital provider expects to receive a certain specific percentage (or multiple) of its invested capital before the buy-down option can be exercised by the business owner.The business owner can exercise the option by making a single payment or multiple lump-sum payments to the capital provider. The payment buys down a certain percentage of the royalty agreement. The invested capital and monthly royalty payments will then be reduced by a proportional percentage.Buy-Out Option:In some cases, the business may decide it wants to buy out and extinguish the entire royalty financing agreement.This often occurs when the business is being sold and the acquirer chooses not to continue the financing arrangement. Or when the business has become strong enough to access cheaper sources of financing and wants to restructure itself financially.In this scenario, the business has the option to buy out the entire royalty agreement for a predetermined multiple of the aggregate invested capital. This multiple is commonly referred to as a cap. The specific terms for a buy-out option vary for each transaction.USE OF FUNDSThere are generally no restrictions on how RBF capital can be used by a business. Unlike in a traditional debt arrangement, there are little to no restrictive debt covenants on how the business can use the funds.The capital provider allows the business managers to use the funds as they see fit to grow the business.Acquisition financing:Many technology businesses use RBF funds to acquire other businesses in order to ramp up their growth. RBF capital providers encourage this form of growth because it increases the revenues that their royalty rate can be applied to.As the business grows by acquisition, the RBF fund receives higher royalty payments and therefore benefits from the growth. As such, RBF funding can be a great source of acquisition financing for a technology company.BENEFITS OF REVENUE-BASED FINANCING TO TECHNOLOGY COMPANIESNo assets, No personal guarantees, No traditional debt:Technology businesses are unique in that they rarely have traditional hard assets like real estate, machinery, or equipment. Technology companies are driven by intellectual capital and intellectual property.These intangible IP assets are difficult to value. As such, traditional lenders give them little to no value. This makes it extremely difficult for small- to mid-sized technology companies to access traditional financing.Revenue-based financing does not require a business to collateralize the financing with any assets. No personal guarantees are required of the business owners. In a traditional bank loan, the bank often requires personal guarantees from the owners, and pursues the owners’ personal assets in the event of a default.RBF capital provider’s interests are aligned with the business owner:Technology businesses can scale up faster than traditional businesses. As such, revenues can ramp up quickly, which enables the business to pay down the royalty quickly. On the other hand, a poor product brought to market can destroy the business revenues just as quickly.A traditional creditor such as a bank receives fixed debt payments from a business debtor regardless of whether the business grows or shrinks. During lean times, the business makes the exact same debt payments to the bank.An RBF capital provider’s interests are aligned with the business owner. If the business revenues decrease, the RBF capital provider receives less money. If the business revenues increase, the capital provider receives more money.As such, the RBF provider wants the business revenues to grow quickly so it can share in the upside. All parties benefit from the revenue growth in the business.High Gross Margins:Most technology businesses generate higher gross margins than traditional businesses. These higher margins make RBF affordable for technology businesses in many different sectors.RBF funds seek businesses with high margins that can comfortably afford the monthly royalty payments.No equity, No board seats, No loss of control:The capital provider shares in the success of the business but does not receive any equity in the business. As such, the cost of capital in an RBF arrangement is cheaper in financial & operational terms than a comparable equity investment.RBF capital providers have no interest in being involved in the management of the business. The extent of their active involvement is reviewing monthly revenue reports received from the business management team in order to apply the appropriate RBF royalty rate.A traditional equity investor expects to have a strong voice in how the business is managed. He expects a board seat and some level of control.A traditional equity investor expects to receive a significantly higher multiple of his invested capital when the business is sold. This is because he takes higher risk as he rarely receives any financial compensation until the business is sold.Cost of Capital:The RBF capital provider receives payments each month. It does not need the business to be sold in order to earn a return. This means that the RBF capital provider can afford to accept lower returns. This is why it is cheaper than traditional equity.On the other hand, RBF is riskier than traditional debt. A bank receives fixed monthly payments regardless of the financials of the business. The RBF capital provider can lose his entire investment if the company fails.On the balance sheet, RBF sits between a bank loan and equity. As such, RBF is generally more expensive than traditional debt financing, but cheaper than traditional equity.Funds can be received in 30 to 60 days:Unlike traditional debt or equity investments, RBF does not require months of due diligence or complex valuations.As such, the turnaround time between delivering a term sheet for financing to the business owner and the funds disbursed to the business can be as little as 30 to 60 days.Businesses that need money immediately can benefit from this quick turnaround time.