Sahel Rafael Tamayo - A Cuban American Entrepreneur

June 24, 2018

Five Tips for Finding Venture Funding

Many people ask on the ways to find venture funding. Well, if you are wondering on how your startup can acquire venture capital, it almost definitely can’t. Venture capital is a rarified atmosphere of emerging businesses and high-end startups with experienced management teams, secret sauce, high potential growth, and much more.

People who don’t have track records do not get venture capital. Businesses that do not look like they can grow fast and be enormously big size do not get venture capital. Even service businesses do not get venture capital. Therefore, before you start looking for venture funding, you should understand first the difference between an angel investment and venture capital.

You have to take note that venture capital demands almost the same as angel investors do. Majority of venture capital likes to invest bigger amounts in late-stage startups.

Below are some of the tips for finding venture funding:

1. Never Do Anything in Bulk

Get rid of the email templates like plague. Never think that serious investors would read summary memos or watch the pitch, less read business plans, when it looks like it is being sent by bulk to different investor. This concept basically dates back in 1980s when some people imagined that the venture capital companies were looking at the business plans coming unsolicited. They were not, yet sometimes, they pretend they were.

2. Do Your Homework

Determine some venture capital firms that invest the amount you require in your industry, region, and at your development stage. Venture capital companies each have their own unique identities, interests, and personalities. They also have preferences regarding where they invest, what amounts, and at what stage. Majority of them have sites and most sites announce their preferences. They do not like to deal with those who are not in their category and do not know it. The reason behind it is that they actually expect you to know.

3. Have an Instant Summary and Good Tag Line

Begin with an elevator pitch and get every key point down, yet the theoretical sixty seconds of classic elevator pitch is a bit too much. You have to describe your business in 1 sentence or 2 and that sentence should be intriguing. People had success with some known business of new business area.

4. If Your Summary Memory or Summary Video Works, Consider Pitching

The pitch is basically the slide deck, yes, however that isn’t what matters. It is the venture capital companies chance to meet you and see your team as well as the story of your business. There are various things about pitches. But, never think that failure or success depends on the pitch because it does not. It depends on the credibility, story, and assessment of the venture capital companies for your future prospects.

5. Ready Your Business Plan

It will serve as your screenplay while your pitch will be the movie. Never do the plan too formal or too big because it isn’t going to last and must not be older than 2-4 weeks.

Conclusion

Never consider spending investment money before the check clears the bank. The deals fall through always. Aside from that, select an investor wisely.

June 24, 2018

How to Calculate Your Net Worth

There are many net worth software and calculators that will help you calculate your net worth. However, for you to get the most out of these, you must be able to calculate your own net worth by yourself. It only requires understanding about net worth.

Net Worth – What is It?

Generally, your net worth is your assets or everything you own minus your liabilities or what you owe. Assets may include investments and cash, your house, and some real estate properties, vehicles or anything of value you have. Liabilities, on the other hand, are what you own on such assets such as student loan debts, mortgage, and car loans.

Net worth is basically your financial health’s measure since it actually says what you’d have left over once you sold your assets to pay your debts. Each financial move you create must be aimed at boosting your net worth. It means either decreasing liabilities or increasing assets.

Steps to Calculate Your Net Worth

It is an easy and simple process to calculate your net worth, yet it requires that you gather all information that surrounds your current liabilities and assets. Majority of financial planners recommend that all of their clients keep a secured folder with information on all liabilities and financial assets to be updated every year. Organizing and gathering this information can bit a chore at first, yet ensures that you have an access to the information once required.

Even if such a folder may be turned into more, calculating net worth only needs basic financial information about the things you own as well as the debts you owe. Below are the ways to get started:

Calculating Assets

Begin by listing your biggest assets. For many people, it might include the value of their home, vehicles or any real estate properties. In case of business owners, this list will also include the business value that has its own complicated calculation. Ensure that you use accurate market value estimates in current dollars.
Gather the latest statements for more liquid assets. Such assets include savings and checking accounts, cash, some investments or CDs.
Consider listing some of your personal items that can be of value. Such might include coin collections, valuable jewelry, musical instrument, and so on. You do not have to itemize everything, yet you may try listing items that are worth $500 and more.
Add all of the assets together and get the total assets.

Calculating Liabilities

Begin with your major outstanding liabilities including the balance on your car loans or mortgage. List such loans and current balances.
List all your personal liabilities like student loans, balance on credit cards, and so on.
Add everything and get the total liabilities.

Calculating Net Worth

For you calculate your net worth, subtract total liabilities from total assets. It does not matter how small or big the number is. It does not matter if the number is negative because your net worth is the starting point to have something you can compare against in the long run.

Always be conservative with the estimates, particularly with vehicle and home values. Inflating value of big assets may look great on paper, yet might not provide your precise net worth.

June 24, 2018

How to Earn a Million Dollar Salary

Lots of people would want to be a millionaire. But, how can you earn a million dollar salary? Well, jobs in finance, business, and entertainment are among the best compensated, yet not all working in such fields would take home a million dollar salary. Less than one percent of people across America are pulling down seven figure income yearly. Even in the industries where high salaries are common, they are still not the norm and might take years before they work their way up to the pay scale. However, below are the jobs that will help you earn a million dollar salary:

Corporate CEO

Average CEO basically earns about $175,000 annually. However, other chief executives earn more. In fact, there are others who earned million dollars within a year. But, it depends on what industry he or she is working on. For instance, the CEOs of the companies including American Express, Boeing, Target, and Qualcomm earned more than twenty million dollars every year.

A-List Actor

Celebrities who are bankable may take home million dollars paychecks. For example, in 2015, Robert Downey Jr. earned $80M, which made him the highest paid actor across the globe. He took home a total of $40M for his appearance in a movie and Jackie Chan also made $50M as part of the movie Dragon Blade, which basically made $120M in China.

Screenwriter

Screenwriters who are successful may earn $1M or more for scripts and about $500,000 for script touch-ups and rewrites. The usual writer was not taking home a 5-figure income. Median earnings for the writers were $125,000 only.

NBA Player

Professional basketball players are said to be among the best-paid athletes with about $5.15M annual salary. While huge earnings of basketball players like Lebron James and Kobe Bryant skew that number, majority of NBA players earn more than a million dollars every year.

Law Firm Partner

Being a law firm partner could translate to huge amount of money for lawyers. Partners in various law firms can earn about $1M every year. Those who have been a partner for many years earn more than the average salary of law firm partners.

Banker

You do not need a job in C-suite to earn a million dollar salary on the Wall Street. Managing directors at investment banks earned a million dollar salary a year plus some bonuses that they can earn.

Earning a million dollar salary can be challenging and may not be simple. However, if you are determined to be a millionaire and would do anything to earn million dollar salary, try one of those jobs listed above. If your chosen career isn’t near from those of the listed jobs, there are other ways on how to be a millionaire. You can launch your own business or you can sell your products or services to companies. Although it will not make you earn a million dollar salary instantly, you will be in the long run.

June 24, 2018

When to Bring in a Partner for Your Business

Adding employee positions may seem to be the most obvious choice when thinking whether to bring a partner for your business. For sole proprietors who don’t want to dilute ownership, this can be a good move. But, adding business partners gives something that hiring employees doesn’t, which is the dedication and motivation that comes from having stakes in the business.

Typically, employees have the freedom to leave their job for one another anytime. Giving partners a share of your business may result in an uptick in dedication and motivation. They have also an interest in persevering through the challenges as well as helping business be more profitable and stronger.

Since partnership basically means sharing ownership, it isn’t a decision that you should take lightly. There are times that it makes sense to stick with ownership and the power to make decisions by yourself. You may go solo if you can.

The best partner can be incredible to the business success. Yet the reality is, there are lots of amazing employees out there. If you concentrate more on the process of your business, get the right ones to execute the process and you’ll be in good shape. However, partners can be essential when returning a business to growth and stability if you’re careful regarding the agreement’s structure.

Think of the dilution of your ownership as you take on partnership. Consider having a partnership agreement in place where all your roles are clear. See to it that you do your due diligence when it comes to the person, the amount of business you’re giving away as part of partnership and long term goals of every partner.

It is really a big decision for the reason the entrepreneurs must consider their co-founder relationship as they would consider a lifetime partner. There are many reasons why you should share ownership and take on partners and these include the following:

Having a detailed and solid partner agreement.
Reducing the risks of turnover through adding partners rather than hiring employees.
Sharing opportunities and challenges with others who could help business grow beyond what you can accomplish by yourself.
Reducing burdens on your energy and time.

Bringing one or more partners can be breath of fresh air. Rather than relying on your creativity, skill sets, and perspective, you will create a team of equals whose combined ideas and skills improve the business. Having a partner could mean an A-player at all positions. Aside from that, once you concentrate on a much narrower domain, you will discover nuances you never knew existed. Creating this nuanced understand of domain is what provides you a financial and competitive edge. Through concentrating on the core area, you will accelerate your growth and will be able to differentiate yourself from the competitors.

Time to Consider Partnership

Changing business from sole proprietorship to some kind of partnership is not for everybody. However, if both partners have the same vision, it can be stabilizing for one another. With this, it’ll result in higher profitability and huge success in the long run.

June 24, 2018June 24, 2018

How to Save $1,000 in 45 Days

Regardless of your experience in saving money, it isn’t impossible for you to know how to save $1,000 in 45 days. Just take little steps and focus on your priority, which is to save money. So, how do you save money quickly? Well, you need to work with what you have.

The basic advice to save $1,000 in just a month and a half is to have a good budget and cutting back on your spending. Make a budget and you will see how much money you’re wasting monthly. Then, you’ll get $1,000 in no time. Some had tricks including stashing away each $5 bill they got and save every dollar bill and loose change. This could not add up to a thousand dollars, yet it will surely help you get there. The top and best suggestion to cut back on expense is to avoid dining out.

Consider Bringing in More Money

There are countless of ways to bring in more money. One of the best ways is to sell your things and some items that you no longer use. Craigslist, eBay or garage sale can be beneficial as it will not only help you get rid of the things you do not need, but also you will earn extra money.

If you are not up for any garage sale, sell your silver jewelry or old gold. This will help you earn hundreds of dollars easily. If your job lets you work overtime with pay, it is also a good way to bring in more money. If that is not an option, you may use your talents or skills to earn extra money through finding part-time jobs. You may also clean somebody’s house during afternoon. You can also baby sit or walk dogs. Teaching someone how to do some things they don’t know is also a good idea. Although it will not pay you a huge amount of money, it’ll add up for your savings.

Save Money Through Getting Deals

Some are making a wise move to cash out life insurance policies to knock out their aim. They will get whatever cash is available from such policies and save money on the premiums through switching to the term life insurance. Other than that, you could save money monthly through shopping around for good deals on auto insurance, home insurance, health insurance, and life insurance.

Other than insurance, you can also find and use some deals when shopping online or in grocery stores. With this, you can save a bit, which can be helpful to achieve saving $1,000 in 45 days.

Believe That You Can Save $1,000 Fast

Whatever tricks you spend or how much cash you could dig up, you will not hit your $1,000 goal if you do not picture yourself achieving it. You need to believe that you can do it and claim it. Today is the best time for you to take control of your money. Learn the ways to save money, make your own budget, pay off debts, and invest for your future.

June 8, 2018June 8, 2018

When to Refinance Your Investment Property

Getting money to make a downpayment on your investment property can be a bit challenging. The payment method that you utilize to pay all or a part of your downpayment is important to your own financial stability. It has become common recently for experienced and new investors to experiment with the alternative funding sources. Things like self-directed IRA, self-directed 401k, as well as private money lenders help more people to be property owners.

Once you finance investment property, you might doubt about when and how you can do it. Well, it’s natural. But, through knowing some things to consider when refinancing your investment property can surely make a difference in getting the results you want.

Refinancing Investment Property

When you’re considering this option, you should understand the options of going to a mortgage lender or a bank. You have passive income property that doesn’t have any guarantee that the loan won’t be repaid. With this threat in mind, banks and lenders now limit the amount of money that’s available for refinancing. Loan might be something new to you even if it has been used in the industry of real estate for years. This term revolves around the property’s current value in comparison to the requested amount of load. Lenders pay more attention to LTV rations compared to previous years. Majority of lenders have 75% or less LTV.

It means that once you request for refinance, you’ll likely get seventy-five percent of the property’s appraisal value. This number is on high end and several investors could only get twenty-five percent. Unsecured debts and personal credit scores are always the factors to get approval for investment property refinance. In today’s economy, a lender will basically refuse or limit to lend you money if the ratio of your income and debt falls below the predetermined threshold. However, it’s possible to refinance any of your investment property at lower rates to cash out equity.

Why Refinance Interest Rates are Important?

Examining your current interest rates would interest both you and the lender. You might not qualify for refinance depending on the original rate since the lender might lose money. Even if the interest rates are low, once the rates rise in the future, the bank would still honor the low refinanced rate. It might cause the lender to lose money based on the original agreement. This is why careful reviews are made of economic conditions in the future, your employment and credit and received income from the property before the final decision is made.

Refinance isn’t something that happens in an overnight process and you will be able to know the answer by morning. It might take a lender a few weeks before you’re notified about the approval. Holding keys to any investment property is exciting and one of the best things in life. Getting out the property’s equity to make repairs or invest cash in second property is a crucial decision. You may refinance any investment property you have if you fully understand how decisions are made as well as what you can stand to lose.

June 8, 2018June 8, 2018

Best Investments for 2019

You already have some money to invest for year 2019. But, what are the best investments you can take for consideration for your hard-earned money? Remember that you have to be smart when investing if you like your money to count.

While you are completely aware of the different investing options available, the number of the possibilities is overwhelming. In the world of investing, it’s best known as paralysis by analysis. You spend more time analyzing your options, which you wind up putting it off and don’t invest at all. Then, your extra money will be consumed by unexpected expenses or bills.

If you want to ensure that your extra money does not disappear, you have to invest that right away. A particular amount of analysis is good if this will help you find the best and right investment option for your goals, yet you still have to act quickly.

Below are the best investments to consider for 2019:

Stock Market

While investing in stock market is some of the basic advice you will ever read, there is a reason behind it. While everybody is aware that investing in stock market has paid off, there are numerous people who do not rely on the financial markets and consider sitting on the sidelines together. But, there are also others who think stock market is overvalued that they’d be crazy to jump in.

So, the best thing you should do is to invest on small amount of money over time with the use of the method known as dollar cost averaging. It requires you to trickle your money into some investments over a particular period of time. It may be a year or 18 months. It can even be 4 years.

Dollar cost averaging works whenever the market is high and you will buy fewer shares and once the market is low, you will purchase more shares. It means that in the long run, you’ll have lower market share price with the use of this method. It is easy to see why it could be beneficial.

Real Estate

Aside from stock market, another investment strategy that you should consider is real estate. There are numerous ways to invest in real estate without the need for you to deal with the physical property. An option to consider is investing in some real estate notes. You should trust to invest in the real estate notes that are offered by a person. You can also try other real estate investment options that are guaranteed to make you earn more. Yet, make sure to ask for professional advice before making any move.

Try Investing in Yourself

It might sound a bit cheesy, yet it is actually one of the best investments anybody can make. Through investing in yourself, you’re improving the largest asset you will ever have. There are several ways to invest in yourself that do not cost lots of money. It might sound cliché, yet it is a bet that will definitely pay off. If you like to make most of your investments, one of the smartest moves you could do is betting on yourself.

June 7, 2018

Top 5 Ways to Passive Income

Passive income is basically money generated even while you sleep. Simply put, there is no need for you to engage in a job or punch a clock just to earn this form of income.

However, this is not something you can do with a mere snap of your fingers. Effort is still required as you set up your stream of passive income. But, the moment it is sets off from the ground, there is nothing much more for you to do than collect the cash you earned.

Below are the top 5 ways to passive income that you can try:

Rental Properties

Rental properties used to be considered as forms of passive income that require high maintenance. However, crowdfunding has dramatically changed the market of rental properties. You could now buy a share in an extensive array of rental properties which don’t need any maintenance or management at all. Since you can access rental markets from various parts of the world, you could boost your passive income from these rental properties with no need to be limited to what is available in your backyard.

Monetize a Blog

When it comes to monetizing a blog, you can choose between using affiliate links and getting advertisers to pay for their spot on the blog. But, to make your blog work in making money, make sure that it contains quality content that will keep traffic coming. Look for a good copywriter who can help you with writing engaging content. These professionals can also help you find the most interesting topics.

Design and Sell a Course

The internet opened a world where people demands for information. From how-to guides to DIY tips, people want to improve their current knowledge and skills. This is why paid courses come in handy. There are sites that provide paid courses on the internet. You can design your very own tutorials then sell it to those people who need and are interested them. You could upload them and make a passive income out of it.

Use YouTube

There are billions of people using YouTube every single day. To earn a passive income on YouTube, start by monetizing your YouTube channel. It allows YouTube to put adds on the videos you upload, provided that the videos meet copyright requirements. With good lighting, quality editing software, and professional camera, you could go a very long way in making your videos on YouTube. And similar to blogs, you can get paid for promoting and reviewing brands the moment your channel becomes popular.

Peer-to-Peer (P2P) Lending

P2P lending is still new in the world of finances where independent borrowers and investors are allowed to make private loans with no need for a traditional intermediary. P2P loans are being arranged with the use of a clearing house which provides borrower information and facilitates negotiations of loan duration and interest rate. While this requires some legwork, the returns can far outweigh those in traditional passive investments. This is something you can do right in the comforts of your own home, with some projects interesting enough that you would definitely not miss being a part of.

June 7, 2018

How to Get an FHA Loan

FHA loan is among the best choices of loan available right now for homebuyers looking for a low down payment and easy qualifying standards. The FHA or Federal Housing Administration is part of the Department of Housing and Urban Development of the US.

FHA is not the one that makes the loan. Instead, the loan gets funded by a lender approved by the FHA in accordance to the lending guidelines of FHA.

FHA basically protects lenders from loss in case of borrower default. Through this loan guarantee, FHA provides a form of federal assistance that allows moderate and low income homebuyers afford their dream home.

It was during the 1930s’ Great Depression when the FHA program was originally made to act as a catalyst to stimulate the economy of the nation and stabilize its housing market. From then on, millions of moderate and low income borrowers were able to refinance or purchase their houses through FHA loans.

Application for FHA Home Loan

The very first step when applying for FHA loan is to get in touch with a lender approved by FHA. FHA loan is considered as the easiest form of real estate loan where you can be qualified for since it just needs a low down payment and doesn’t require a perfect credit. The FHA loans are not only meant for single family properties. It is also possible to get a loan to refinance or purchase condominium, fourplex, triplex, or duplex provided that the borrower occupies one of the units. These loans are not meant for investors or for purchase of vacation homes.

For the process to officially start, you have to provide basic information to your loan specialist, which include the following.

Address or addresses of the borrower for the past 2 years
Social Security Numbers of all the borrowers
Current Paystubs
Employment information for the past 2 years
Banking statements for the past 3 months
Federal W2’s for the past 2 years
Information about owned real estate properties if any
Certificate of Eligibility ad DD-214 for the veterans
Federal Tax Returns for the past two years, Business Balance Sheet for the self-employed, and Income Statement
Pay for credit report and property appraisal by FHA

To be qualified for an FHA loan, you have to meet the following criteria:

Must have a valid SSN, lawful US residency, and of legal age for mortgage signing in your specific state
Must have steady history of employment, looking for a minimum of 2-year history
Must have minimum down payment of about 3.5% to apply to the purchase price
Mortgage payment which include PITI requires to be below 31% of gross monthly income
Overall monthly debt, including credit cards, mortgage, student loans, auto loans, and others cannot go beyond 45% of monthly income
Must be a minimum of 3 years from foreclosure with a good credit
Must be a minimum of 2 years out of bankruptcy with a good credit
Must have 580 minimum credit score

June 7, 2018

Five Things to Know About 1031 Exchanges

A 1031 exchange basically enables you to sell a business-use or investment property for another investment or business use property of greater or equal value deferring the capital gains tax, healthcare tax, state taxes, and depreciation recapture tax.

You have to take note that in terms of 1031 exchange, some special rules apply. As with everything else in today’s life, once it sounds too good to be true, it could be. That is the reason why it is important to get assistance from professionals before you make any decision.

Below are some of the things you should know about 1031 exchanges:

Never Touch the Proceeds from the Sale

It is essential to not have proceeds from sale touch your business or personal account at closing. But rather, see to it that you utilize an accommodator for securing funds in between selling down-leg and buying up-leg. Although the funds placed in your account is for less than sixty minutes, it could likely trigger tax consequence. So, you need to be aware of this in terms of 1031 exchanges.

Like-Kind Property is Actually Vague

The use of like-kind term is essential to note. Based on IRS, it actually refers to the investment’s nature instead of the form. For instance, you may exchange apartment building for net leased investment or a walnut farm or vice versa. You should ensure that you talk to the consultant regarding how it could trigger depreciation recapture.

1031 Exchanges Have a Time Frame

Basically, you only have forty-five days to determine 3 possible properties or two hundred percent of the property’s fair market value sold at the close of the escrow of down-leg. You have 180 days to buy your exchange property after you have sold the prior investment property.

Investment Properties Only

It is important to note that you can’t use the funds from proceeds to buy personal property. It only means that you can’t sell your own apartment building to buy a new house or use money to fund your own dream holiday vacation. If you sell any investment property, you should buy another investment property.

Replace Your Debts and Proceeds

When buying any exchange property, you should replace cash proceeds plus debts from the property you are selling on another investment. For instance, suppose you like to sell the property a million dollar, get half a million dollar in cash proceeds, and got a loan of about $450,000. You need to use the cash proceeds and replace your loan. Once you take out some cash or get smaller loans, it’ll be considered boot and this will be a taxable event.

Once executed properly, 1031 exchanges must result to no current taxes and it’ll continue growing tax deferred. It is essential to do your own research and everyone is encouraged to speak to an accommodator on 1031 exchange, CPA or attorney before you do an exchange. For the meantime, you may consider repositioning your investment portfolio.