Why a Family Office Might Be Right For You
Capital is at the heart of any business - new or old. Finding capital can be the tricky part. Thankfully, family offices like Scandia are here to fill the gaps left by venture capitalist firms and traditional banks – which just don’t fit every business.
The Family Office Approach to Financing
At Scandia Partners, the family office setting is ingrained in everything we do. Family Offices generally manage the portfolio of high net-worth individuals. We work with a number of successful businesses and have a proven track-record of building upon and nourishing their success. Scandia is of course concerned about your businesses balance sheet, but we also partner with businesses we know offer more than just their numbers.
Scandia Partners always puts family first. That’s why we think our investments become so successful. We understand the value business operators and employees bring – in fact, we view our business operators as an extension of the Scandia Family. It’s not just about throwing money at something to make it work. We know that hard-work and a People-First mentality is what can lead to success alongside a capital investment. Does it sound like your values align with ours? Then our family office could be for you.
Many Family Offices focus on a particular segment of businesses or goals. At Scandia, it’s generally service-related and tech-enabled companies. If your business overlaps with these two in any way, you’ll find the experience with a Family Office like Scandia can offer invaluable support for the growth of your business. However, we don’t just work with these two types of businesses.
The absolute most important reason to choose a Family Office when seeking funding is the flexibility offered. Scandia can be agile. Do you have a manager in need of leadership training to increase productivity? Our team can help provide that. Do you need logistics support to make it through a particular challenge? Our team can help provide it. Family Offices are agile. At Scandia, you can always pick up the phone and call us. It’s one of the reasons we want you to be part of the Scandia Family.
Navigating funding can be a huge challenge, but it doesn’t have to be. A family office can be a good fit for a lot of businesses and startups. Press the contact button if you’d like to learn more about Scandia Partners and the family difference that gives us an edge over venture capital and private equity firms.
How To Assess Funding Offers
Scandia Partners is a family office dedicated to investing in and growing our partner businesses. We wanted to put together some ideas as you sort through various types of business funding offers. First, let’s recap some of the type of funding out there for your business.
Loans can be an easy way to secure funding for your business. In addition to private business loans, you can secure business lines of credit as well. SBA Loans or Small Business Administration loans can be a big help as you start your business. These are generally location-based and offered to spur economic development in certain areas. SBA loans can be a great option because the interest rates can be lower than the private market, with higher possible loan amounts.
Grants are generally not the biggest source of funding you’ll find, though they can provide supplemental funding for your business. Make sure you understand the terms of accepting any grants and whether those grants include any particular building improvements, etc.
Chances are, you’ve heard about this type of funding. It’s a great option for many businesses. You pitch your idea and a firm is willing to take a chance to invest.
Family offices generally manage the investments of high net worth individuals and invest in businesses with which their values align. Mission and goals are just as important as profits and bottom-line.
When you start to think about the different ways to fund your business, keep in mind the following:
- Mission Statement & Vision: Does your mission statement and vision align with a Family Office more than a VC firm? Could a VC firm reject parts of your mission statement/vision?
- Plan for profitability: Make sure you have a plan for profitability. Where will you be in 1 year, 2 years, 5 years, etc? If your plan for profitability will not return a profit fast enough for VC firms, you might want to consider alternatives like loans or a family office.
- Expertise: Are you looking for a partner that cares more about dollars and cents? Family Offices can generally provide mentorship and expertise based on the types of businesses they have worked with in the past. It’s something that VC’s generally don’t provide.
If you want to learn more about what it’s like to work with a Family Office when it comes to seeking business funding, reach out to Scandia Partners.
Making Your 2022 Business Projections
One of the most important tools available to the businesses in the Scandia family office is the power of planning. Annual projections can help assess the financial health of your company each year. Whether you are seeking funding from a family office like Scandia or any other financial backer in 2022 or simply planning your budget – projections are absolutely necessary.
Even if you have an accountant or accounting team, make sure that someone in senior leadership always reviews actuals. Look at your 2021 income and expense reports. In addition to looking for anything that stands out, this is an easy starting point to create your 2022 projections.
Are you close to landing a new client? Have you added to your sales team? Sit down with your staff and analyze what you expect whether it be an increase, decrease, or remaining flat. Income statements provide an estimate of the net income of your business. If you are a new business, reach out to partners like your investors or Scandia and we can help you put together a plan based on benchmarks from your industry.
Just as important as estimating your income is providing an estimate of expense in 2022. Is there a large project on the horizon? Perhaps you are purchasing a new building or performing renovations? Whatever the case may be, you can always look at your 2021 expenses as a starting point. Remember to include the expenses related to your salaries and benefits, day-to-day operations such as rent and utilities, cost of supplies and materials and any anticipated increases or supply issues, cost of services/software, and the maintenance and upkeep of your facilities, fleet and equipment.
Consider Market Factors
Are you in a volatile industry? Are you anticipating supply chain disruptions? Or maybe you will benefit from the current environment because you can continue to get products to market despite disruptions. Don’t forget to reach out to your suppliers and make sure you are prepared for any increases in the costs of goods or services.
Evaluate Assets & Liabilities
Perhaps 2022 is the year to pay off an outstanding business debt. Build in contingencies and funds for things like this or replacing aging equipment or upgrading software.
Every business should always have reserves for operating in case of an emergency or issue. How many months can your business sustain itself if there is a drop in income or disruption?
We hope you found these tips helpful. If you’d like to reach out to the Scandia family office for more info or to consider becoming a partner, press the Contact button above.
No-Cost Investments You Can Make in Your Company Culture Today
These days, company culture is at the forefront of recruiting and can be an important retention tool as well. There are easy ways to invest in your company culture in 2022. No, we’re not talking about ping-pong tables and free food. Company culture runs deeper than that and this topic is one we always discuss with leaders at the Scandia family office.
Review Core Values
It’s important to always be growing and evolving, especially within your business. Have you sat down with your leadership team to discuss values and value-alignment for the coming year? This can be as simple as reviewing your core values and asking your team, “Do these values still ring true for our company?” Identify ways your company does or does not reflect these values and make note of internal changes you can make to allow your business to better reflect your core values.
Don’t be afraid to include your team members – after all, they are important stakeholders. We’re not just talking about a brainstorming session. Find ways to keep your values at the top of your team’s mind. Regularly reflect on them in team meetings, have the values be accessible in common areas, email signatures, etc. Live them out in your day-to-day interactions with employees, customers, and vendors.
Core value development is one of the many areas the Scandia family office makes the relationship with our investments different than traditional capital resources.
Strong, open, and proactive communication will be key to a thriving company culture in 2022. Assess your current communication methods and look for new, creative ways to keep your team in easier contact – especially if you are working remotely.
Consider implementing tools like Slack, a workplace communication and task platform that has a free-to-use tier. Even if some of your team continues to work remotely in 2022, keep regularly scheduled video-conference team meetings to keep lines of communication open and strong. If your team was used to face-to-face meetings on a regular basis, keep that little sense of community going.
As you lay out the calendar for your business in 2022, look for ways to celebrate both big and small. Identify milestones you can celebrate as a company. For example: number of years in business, celebrating a number of projects or clients, recognizing revenue or profit goals, or even expansion of the team. Is one of your employees hitting a big milestone? Celebrate it! Did you land a big account? Successfully launch a new project? Why not celebrate as a team?
Find ways to surprise your team with celebrations of their hard work. Set goals and celebrate with them as a group as you reach them. Consider putting employees’ birthdays, work anniversaries, etc. on a calendar and make a point of acknowledging them – whether with an email for a work anniversary or an office celebration for a birthday.
There are creative ways to socialize, even when your team is working remotely. Consider implementing group volunteerism as opportunities to both encourage socialization and to give back to your communities. We have seen many successful businesses allow employees time off once a quarter or once a month to participate in group volunteer activities. From Meals on Wheels to volunteering at the local food bank, check out Volunteermatch.org to find opportunities in your area. In our experience as the Scandia family office, this type of activity can really make a difference for your team’s morale.
We hope these simple tips and ideas can help you plan out your 2022. Here’s to a great year and developing a positive Company Culture in 2022. If you’d like to learn more about the Scandia family office and possible investments, check out the rest of our blog posts or contact us.
Finding Funding to Grow Your Business in 2022
After two rounds of the Paycheck Protection Program (PPP) Loan, many small businesses are assessing the funding and lending landscape. It’s so important to think about outside funding as a way to boost your business and its outlook in 2022 – but it’s equally important to weigh each option prior to jumping in.
Thinking Outside the Brick-and-Mortar Bank for Traditional Loans
Oftentimes when we think of loans, instant images of meeting face-to-face with a loan officer at a bank come to mind. These days, it’s rare that any decision is made locally at the big banks. Think about reaching out to community banks or even credit unions. These financial institutions are often still FDIC-backed but may be more willing to lend during the current economic climate. Ask about how they handled PPP loans to find out how agile and adaptable they were during the pandemic. Many business owners were thankful to have the help of their bank in applying for and securing loans.
Short-Term Lending & Equipment Financing
Many institutions will offer small businesses short-term loans which can help you fund short-term goals. The underwriting process is generally less stringent and there are even some online providers of this type of capital with easy processes for applications. Equipment financing can also be a way to use assets as collateral to secure a loan – although beware of high interest rates and do not choose your equipment or technology based solely on loan terms.
Working Capital Loans, Microloans or Other Cash Advances
These types of loans are often the easiest to get but can also carry risks. Cash advances against credit cards or business lines of credit often carry higher interest rates due to the risks taken on by the financial institution. Think about how you will pay back these funding options prior.
This is a go-to funding source for many startups. Because it is considered a risky investment opportunity, this is best for new businesses that are growing – and investors will expect a good return on investment. Expect to have to scale quickly to get the investors back their capital.
If flexibility is what you seek, and if you like the idea of outside expertise giving your business a boost – a family office may be the right choice for you. Family offices generally manage the investments of high net worth individuals and have the flexibility to invest in multiple options that they feel they can add value to. In the case of Scandia Partners and Scandia Family, we help our partners achieve a high standard of excellence - with monetary returns being a key but not sole goal of the investment.
If you’d like to learn more about investment options for 2022, read our past blog about the types of startup funding for new businesses at this link.
New Year's Resolutions for Business Owners in 2022
Tax Planning & Anticipating Tax Changes
There is a lot of uncertainty about potential tax changes on the horizon - particularly in light of the Build Back Better suggested tax changes. Make sure that you anticipate any changes and prepare for them as best as you can. Talk to your CPA or tax preparer to make sure that your business is structured to reduce tax liability where it makes sense under the law. It’s never a bad idea to meet quarterly with your CPA to discuss any recent or upcoming changes. You’ll thank yourself for having these meetings well before your business taxes are due.
Consider New Benefits for Team Members
Let’s face it, the advent of Work From Home has changed the game when it comes to our workplace dynamics. Many of these changes allow employees to be more productive and the flexibility can offer those like working parents crucial time needed to help their children – something that can make for more productive employees in the long run. Consider adding benefits that can offer your team more flexibility and give you a competitive edge with hiring. Consider more flexible Paid-Time-Off (PTO) or a hybrid work schedule for parents. At Scandia, we have found unconventional, flexible approaches to PTO particularly effective at creating a strong company culture, improving morale, and increasing productivity.
Examine all of your systems and processes and look for ways to streamline or digitize these processes. Whether it be something as simple as implementing a workplace time tracking program like Kronos or something more complex – these changes can lead to an increase in productivity. Many software solutions do require upfront investment but gains acquired by productivity improvements can offset said impact.
Consider Other Sources of Funding
We saw many businesses, particularly small businesses, accept grants or federal incentives at the height of the Coronavirus pandemic. While many of these grants are no longer available, perhaps there are still other sources of funding that you can find for your business. Contact your local Chamber of Commerce and see if there is anything available that might fit your business model – many Chambers are eager to invest in local businesses, even small businesses!
Scandia is a family office and we pride ourselves on caring more about our clients than just dollars and cents. If you’d like to learn more about Scandia, click Contact Us and get in touch.
As we look ahead to 2022, we are preparing our partners at Scandia for an exciting year of growth, returns and most importantly -- flexibility for our business partners. We are optimistic that consumer demand can push us through whatever Global Health Concerns come our way. Here are a few of the trends we see on the horizon for 2022:
Family Offices have been at the fore-front of funding flexibility, but now it is important for businesses to also commit to workplace flexibility for their team members. It’s something we are embracing at Scandia. With so many of our family office investment team members having family members, you need to enact flexible work environments to adapt to the changing dynamics. We’ve found that team members can be effective with some work-from-home and overall this mentality will support the family-first attitude we’ve adopted in light of the pandemic.
From the implementation of machine-learning or AI technology at your business to simply empowering your team with the latest tools, tech should be at the forefront of your 2022 strategy. If you’re not constantly looking to evolve the processes and systems of your business, you may be left behind from a tech standpoint. Make sure that you are investing adequately in technology to keep processes running smoothly in 2022.
Becoming More Agile - Consider Structure Changes
Many of our businesses saw tremendous changes in 2020 and 2021 and some have adapted. Business leaders who recognize that traditional structures of teams and management may need to evolve to facility the inclusion of freelancers and remote workers. Your business will be far more successful if you can be flexible with your structure and recognize when job descriptions and responsibilities need to change on the fly.
Being Purposeful - Creating a Strong Culture
With so many businesses struggling to retain talent these days, a tenant of success in 2022 will be creating a strong company culture (a positive one, at that!). If you can build momentum within your team this coming year, it will lead to higher retention rates and make recruiting much easier than at your competitor’s.
These are just a few of the guidelines we are looking at to drive our 2022 planning with Scandia’s family office partners.
How Family Offices are Changing the Business Funding Game
Family office investments are shaking up the business funding game and offering an attractive alternative to the cut-and-dry bottom-line decisions pushed by Venture Capitalist firms. There are many reasons to consider a Family Office like Scandia Partners.
The biggest standout about looking for funding from a Family Office is the flexibility if offers. Family offices are able to cut through the red-tape of the funding process to identify potential partners to fund. Oftentimes, family offices are able to fund businesses from varying backgrounds and levels in the business pipeline. It’s definitely the case in the Scandia family, where we look more at the values of a particular business rather than sector or certain bottom lines.
A family office of course does look at ROI or return on investment, but there are so many more metrics than traditional funding methods. Family offices are looking for business partners whose values align with their own. When Scandia chooses to invest in your business, it’s not just your returns that we are looking for. We want to help you scale through more than dollars. We offer mentorship, expertise and support outside of the monetary investment to make sure you meet mutual growth goals to support you in more ways than one.
A Different End-Game Strategy
Many Venture Capitalists are just looking at your business in terms of dollars and cents. Their exit strategy is simple -- scale the business so it can be acquired later. This means firm deadlines and contracts that require them to be bought out at some point. Don’t put this pressure on your business or team. Family offices are far more flexible and many of our holdings are looked at as permanent assets. We are a long-term funder that will be there through the stages and cycles of your business to give guidance along the way.
An Alternative for Start-Up Concepts
Some concepts that would not be considered by VCF (Venture Capitalist Firms) would be considered by a Family Office. We look at businesses not just to turn a profit, but to respect the human element and bring value to the investment.
If you want to learn more about the Scandia family difference, let’s talk. Submit your information here.
Simple steps to create a culture of communicating at your company
The Importance of Communication
Scandia Partners is a family-focused office. That means we are committed not only to dollars and cents (which we are) but to the individual goals and success of each of our businesses and their respective leadership teams. One thing we find is that in many cases, particularly with startup companies, internal communication among team members and from the top can be a challenge.
Some leaders and managers make the mistake of implementing a culture of secrecy and suspicion at the top. They believe that keeping individual team members in the dark about certain projects or the status of certain departments is a positive way of managing. Transparency and open communication are at the forefront of all of our businesses. It’s important to say more than you have an “open-door policy” -- you need to model this in your actions. Regularly scheduled group meetings, memos or correspondence can help keep the team in the loop about what’s going on.
Many of our businesses have successfully implemented internal communication tools. From e-mail newsletters to using a group-work app like Slack, if you make it easy for your team to communicate they will be more productive and efficient in the long run. Communication tools are not only important internally, but it’s also important to keep an open line of communication with customers. Make sure you have a plan for communicating building or business closures to guests via social media like Google My Business, Yelp, and Facebook. Keep an active list of current and former customers to send e-mail correspondence. Some of our businesses have even implemented text tools for things like reminders and surveys.
If you like what you’ve heard so far, check out our past blog at this link on building a strong company culture and consider reaching out. Culture and communication exist in tandem and can improve morale and longevity within your team.
How Customer Service Can Make or Break Your Business
One of the first things we ask potential partners is what their company values are. What is the culture within your business? And then we ask what their customers would say their company values are. Before bringing a new business into the Scandia Family, we go over our deep commitment to customer service and what it can mean for their business.
Customer Service is a make-or-break for any business. From big tech companies to startups from the service industry to anywhere in between, it’s the one link in the chain that can send ripples through your business. It all starts on the front lines with good training. Is your team empowered to solve problems for customers? Do you have a strong training program to help ensure that guests or customers are all treated in the same, positive way?
The word “empower” comes into play especially in times of addressing negative or difficult situations with customers. How you handle a negative customer experience reflects on the entire company. Negative experiences should be viewed as “opportunities” to create loyal customers by handling a difficult situation with grace and providing excellent customer service. We often find that if individual team members are empowered to handle some guest needs, it can resolve situations quickly and positively.
The type of customer service training we are talking about to yield the above results has to be consistent. What if we told you this training will not only help improve interactions with guests but also help you with employee retention? It’s true, investing in your employees and their customer service training will help keep them part of the team.
Don’t forget that a positive customer service culture comes from the top down. Don’t exhibit behaviors or interactions with customers that are outside of your customer service training. After all, your employees are always watching.
Let’s talk more about how Scandia can be not only a partner in your businesses’ financial success but also help you grow and cultivate your team. Contact us via this form and a member of the Scandia family will reach out to you promptly.