Evan Sheftel of New York knew he could grow his business of buying and refining old jewelry. All he needed was capital, and quickly. But he had exhausted his credit with conventional lenders.
Across the country, in Los Angeles, Jay Turo and his company, Growthink, were looking for profitable investments.
Thanks to the Web site RaiseCapital.com, founded in March 2007 and based in Port Washington, N.Y., they found each other. Without even a face-to-face meeting, Growthink, a venture investment firm, put $500,000 into Mr. Sheftel’s business, eAssay, this year and is already seeing returns.
In a financial counterpart to online dating services, companies like RaiseCapital, Go4Funding and Go Big Network are giving small businesses a new way to meet prospective investors. And with turmoil in the financial markets, credit tightening and uneasiness about the conventional financial system, these companies hope to provide opportunities to invest, to lend and to borrow – and to find a market for these services.
“When you have a bunch of smart, ambitious people suddenly flood the market, it makes sense that a lot of new companies will be formed,” said Bob Goodson, the chief executive of YouNoodle, which is trying to bring together entrepreneurs and investors. “Investments in start-ups are highly volatile, but at least it’s a sector that’s upfront about the risk.”
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Photo by MSDesigns.