Do you want to start a holding company to buy other assets, stocks or investments? If YES, here is a complete guide for starting a holding company with little money.
If you have enough cash to invest and you also have friends and partners who can raise you cash, and are also interested in investing their cash with the aim of getting returns without bothering themselves on what it takes to run a corporation or business, then you should think towards starting a holding company.
A holding company basically is a company whose interest is to buy and own the stocks (shares) of other companies with the aim of getting returns on their investment and also controlling the affairs of the company. As a matter of fact, holding companies serve as investment vehicles for investors. Holding companies do not go through the stress of starting a business from the scratch, they are specialists in buying over a company that they know has the potential to make profits not only in the short run but also in the long run.
You will need a large financial base if you truly want to successfully run your own holding company and you will also need investment experts to be part of your team. Of course, you may not want to buy the lion share of a company that is likely not to grow or make profit. This is the reason why you must work with seasoned investment experts that can guide you to make good business decisions.
If you are interested in starting your own holding company, here are few tips that will guide you to get started;
Starting a Holding Company – Sample Business Plan Template
This is the foremost step that you have got to take if you want to start on the right path. Why is this so, you might ask? This is so because you will need to garner loads of information that will help you run your business the way it is. You may consider turning to the internet to garner some knowledge since it is one of the largest community of information. Research on holding companies, how they being operated , major players in this field, the various industries, and a host of other indispensable information that will do you good as you start out.
2. Choose The Industry You Want To Invest In
This next step is equally important because it will go a long way in defining what you want to be a major investor in. Determine whether it is the oil and gas industry, the insurance, banking, real estate, and a host of other industries that available in your country of abode. It is important that you also take a critical look before committing anything so that you do not run at a loss.
Starting out in this industry without a proper plan might be tantamount to a loss. That is why it is very needful that you have a good business plan. What are business plans, and why are they so important? Business plans are the blueprint of your business that helps you chart the right course in business. It is important because you can always fall back to it for direction. You may consider hiring a profession to help you tweak this.
Start up funds is very vital when you are looking to start any venture. This is why you have got to critically look into the various ways that you want to use to raise money. Some of the ways include; savings, family and friends donations, interventions by angel investors, and if you would want to have a partner, then you may consider getting one or more on board who will be able to assist financially.
5. Register Your Holding Company and Obtain the Required Business License
You couldn’t possibly operate this kind of business without being registered. This is where registering your business comes in. This means that you will need to go to your countries office of chamber of commerce or the corporate affairs office as that case maybe. Be sure to provide all the information that you are being asked to provide.
6. Get an Office Space (Office Address)
This is a type of business that you can run from the comfort of your home as such you will need t o get an office space. Consider telling your realtor to find you an office that is in a business district. Also, do not forget that you will need more than offices because of the visitors that you will need to entertain.
7. Source for Companies who are willing To Sell a Large Chunk of Their Shares
This is one of the most important steps that you will need to take. You will need to source for companies that want to be sold. You may consider sending consultants to help you get such information, but of course at a fee. You can consider sending letters of introductions to companies. Also by keeping your eyes peeled to get information about whom and who wants to sell in the newspapers, the internet and what have you.
These are some of the basic steps that is needed to start a holding company. Do have at the back of your mind that sourcing for companies that are willing to sell their companies is not a one off thing. As a matter of fact it is a continuous thing if you want to remain in the game.