Clear Purpose of How To Start An Investment Company Uk
An Investment company is a corporate organization that uses other people’s funds(they are often referred to as Investors) to run a business and at the end shares the profit with the investors. These companies hold and manage the investments capital and give them Return on Investment ROI every month depending on their agreement.
This company can be owned by an individual or a group of people. These companies make their profit most times through Forex or cryptocurrency trading,stock exchange, selling of shares or through real estate management. This company must be registered with the government either as a limited liability company, public liability company, company limited by guarantee or as an unlimited Company. Investors share in the company’s losses and profits in most cases.
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Investing is an act of setting aside a security or an asset over a period of time, as these assets or security tends to appreciate in value in the long run. A good example is when an investor buys an asset with the sole aim of holding such asset for a long term because he believes that these assets will yield a greater dividend in the future. Investing is a means of creating generational wealth. So this asset bought can be sold at a much higher price which could be 10× – 100× of the initial capital that was invested.
Requirements To Start An Investment Company
Most investors desire to own an investment company. And the process for owning an investing company is not as painstaking as it seems. As a matter of fact, owning an investment company of your own can be achievable with these tested and proven steps that I will share with you as you read through, but before we start, I would like to give you some detailed information about the things that you need when to have in hand as you are about to start.
- Initial Capital
- Company name (let it be something unique)
- Register with the Corporate Affairs Commission (CAC):They are responsible for registering and regulating companies and business name
- Get a lawyer
- Business plan
- Marketing strategy
With all these in place we can now go ahead to setup up our investment company with the following steps:
Operational Setup For Investors
The operations section of the investors plan is where you explain – in detail – your company’s objectives, goals, procedures, and timeline. An operations plan is helpful for investors, but it’s also helpful for you and employees because it pushes you to think about tactics and deadlines which are required.
1. Select the Class of investment company you want to operate:-
Yes, this is very important as it will help you stay focused because you are enlightened on what your business entails. There are four types of investment you can choose from
- Private Limited Liability Company (LTD): This type of company keeps the Founder incharge of the affairs of the company alongside few shareholders which could be Members of one’s family. But this types of investment requires a huge capital for setup
- Public Limited Liability Company (PLC): Funds can be raised through selling of shares to the public, in this way you are openly inviting the public to invest in your business, investors can sell their sell anytime they want but Running a Public limited liability company requires more board members in the business and this type of investment is closely regulated by the government and it must be very transparent
- A Company limited by guarantee (GATE): Members of the company are referred to as guarantors and this type of business is mostly for non profit organizations where any profit generated is used for humanitarian services alone.
- Unlimited Company: Members of the company are to be held responsible if the company should suffer or incur any form of losses, members use their personal funds to run the business, but it is usually difficult to be granted a loan from banks with this kind of company.
- Strategize your Business Structure:- This is where you choose the type of investment you want to operate. Do you want a Limited Liability Company, a corporate company or do you want to run a Partnership? This knowledge will help you to know what you stand to benefit or risk in the course of running the company.
- Get a legal backing:- A lawyer should be part of your team and should always be available, especially when investment issues are to be discussed, so that he can bring in his expert knowledge and offer some legal advice.
- Choose a name that you want your company to bear:- This name should intertwine with the values and goals your company chooses to promote. A unique name will help your brand stand out among others and it makes it easier for you to trademark your name in the Corporate Affairs Commission (CAC) during the registration process.
- Choose a Business plan: This part you want to outline your goals and objectives-. Things you aim to achieve through your establishment can be mapped out, the steps you intend to put in place in order to achieve these milestones should be laid out as well. In case you are finding it difficult to create a business plan for yourself, Perusing another company’s business model will not be a bad idea as you will gain more insight on how you really want yours to be.
- Identify your competitors:- Find Their pain points and use that as your strength. Identify the kind of products and services they offer and make your own unique, this will give you more insight on how you can improve in your performance Following the trends will help you know what is invoked and how you can leverage on it
- Explore good marketing strategy:- Identify your targeted audience and proffer a better solution,this could mean giving them a service that they can’t get elsewhere, like a catchy Return on Investment (ROI)
- Fund Raising;-There are many factors that come into play when determining how much fund required to launch your new business. In order to determine your startup capital needs, you must first look at the type of industry you want to start a business in and then decide the cost structure of your business. The three basic types of businesses are: product, service and eCommerce. Product businesses are the most straightforward in terms of cost. Service businesses can be more difficult to determine a startup capital figure for due to the nature of the expenses involved with.
Carrying out a survey on your potential customers helps you to decipher what they really want and you will also understand what’s lacking.
Do not lose sight of your goal
Starting an investing company is not rocket science. A Lot of people are looking for profitable firms to invest in and get profitable rewards in the future. Once you’re investment company is registered with the government and is provides good Return on Investment for customers, then you are good to go. Reach out to your potential customers and be convincing enough to win them over, and start with these ones.
Be honest and realistic about the products and services you are offering and how customers money will be used, this will help your customers to trust you
Good product knowledge will convince your customers that you actually know what you are doing. Always be professional.