Building, developing, and growing a midsize business is a challenging endeavor—one that requires the willingness to embrace risk with high rewards. Growing companies that are more successful than their rivals at navigating this high-stakes environment usually have access to capital, whether through the support of lenders, investors, personal savings, or family and friends. Access to capital helps cushion the blow of late payments and unplanned costs, optimizes working capital when budget items cannot be redirected, and helps business owners invest in resources to seize new opportunities and mitigate emerging risks.
Getting funding for most businesses, unfortunately, is still a challenge. Business owners and executives face enormous barriers against intermediate and long-term capital. And for them, bringing to life their strategic plans, financial objectives, and expansion goals seems out of reach.
One way that midsize companies can improve their chances of getting funding is with better insight. With predictive insights, they can negotiate better terms and provide lenders with the evidence needed to validate their financial integrity and competitive power.
Obtain Data-Driven Proof that Your Business Is Worth Financing
The one thing that makes financiers comfortable with funding anyone and anything is the certainty of data. But even though there is a ton of information about market dynamics and customer behaviors, there is very little competitive analysis available on midsize businesses.
This stark reality makes any investment in smaller companies highly risky. Lenders and investors don’t have access to the knowledge they need to compare the performance of a loan applicant against its rivals and determine how an influx of capital will expedite further expansion and revenue growth.
Predictive analytics allow growing companies to highlight their strengths and weaknesses, confirm current performance and future potential, and leverage what-if scenarios to forecast the impact of the investment. These data-driven insights and models, based on a global database and real-time updates, form a complete picture of the business’s creditworthiness and the value of its future vision.
Growing companies can also apply this same information to negotiate lending terms that are favorable, optimal, and fair. Executives can analyze the business’s credit rating and check the average interest and payment agreements that are typically put into place for that score. Plus, they can find areas that could be improved—from the supply chain to the customer experience—to better position themselves for lenders and investors.
Take Control of Your Financial Future
For prepared midsize-company leaders, financing can become an empowering moment. The right intelligence delivers a real-time view of the current state and an accurate depiction of a future ignited by investment and innovative thinking. This approach not only helps ensure that businesses have access to the resources they need to succeed, but also signals to financiers that their investments are profitable and secure.
Find out how your midsize business can run as an intelligent enterprise to sustain growth over the long term by getting the most value from your data and insights.
- Download the Forrester Consulting infographic, “Becoming An Insights-Driven Company”
- Watch the on-demand replay of the Forrester Webinar, “How Can Midsize Businesses Become Insights-Driven?”
- Read the blog “Self-Rating Gives SMEs A Complete Financial Picture For The First Time”
This blog originally appeared in the D!gitalist Magazine and has been republished with permission.