Humble Bees Advisory Services Pvt Ltd

In their own words

Our mission is to introduce equity funding culture among entrepreneurs in Jammu and Kashmir. For a business to kick-start, initial capital is a pre-requisite. An entrepreneur wishing to start a business needs funds. There are two types of funds he can put into his proposed business: a) a capital of his own and b) loan from a bank. Bank loans are sought only when he feels his initial capital is insufficient to start the business. However, seeking loans from a bank has huge implications and the sword of returning the interest on a monthly or quarterly basis, the entrepreneur, in case of a dismal start, feels depressed. We strongly believe funding from bank is the root cause of his failure because of two reasons: Banks are not concerned about whether the business is running successfully or not, they are interested in their interest only. In case a business collapses, the banks will seize the mortgage to recover their principle amount and the interest. Sometimes, the interest exceeds the principal amount. The equity funding on the contrary works on a different principle. An entrepreneur deficient in his capital registers his concern as a private limited company. Suppose his business needs Rs 1,00,000 as the initial capital, he divides it by Rs 10 to give rise to 10000 shares. Through our platform, he then approaches masses with a brief description about his business plan. If the interested people like his business idea, they subscribe to the shares of his company. For instance a small investor would like to contribute only Rs 100, he will be given 10 shares and his stake in your company is 0.1 %age and at the end of year the profit will be divided by 10000 and everybody will be paid in proportion to the shares he held in the company. This is called dividend and next year the company valuations per share may be Rs 12/- instead Rs 10/- This is called capital appreciation and any time they can sell their stake to somebody else. Thus equity share holders are all-weather friends. They stay with you in situations wherein you make profit or suffer a loss as against the bank funding. Moreover, no mortgage is required at any stage of the business. Ownership rights are given to the share holders on the assets of company. Above all, you have a limited liability on you. Company law also states if your company runs in loss, there is no liability on the share holders for only company assets needs to be liquidated to meet the liabilities of sundry creditors. Even if it is not enough shareholders are not held responsible whatsoever. These advantages give entrepreneurs to run their business without fear of suffering any loss. Transparency is the hallmark of equity funding as the company accounts are in public domain. The number of share holders, in a private limited company, cannot exceed 200 and if you register your company as public limited, there is no such bar on number of share holder you have.

Written by the company on its public Startup India profile. Not verified by us.

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