CFM offers solutions for SMEs to raise capital from customers

By Diep Anh December 18, 2022 | 11:00 pm PT

Customers are quality investors and shareholders of small and medium-sized enterprises (SMEs), according to Nguyen Quoc Trung, Chairman of CFM Investment Joint Stock Company (stock code: CFM).

Trung said the biggest challenge for SMEs is raising capital. In the context of global economic recession, and rising bank interest rates, SMEs lack reserve capital to maintain operations, but not all enterprises can access bank loans.

When a company relies too much on borrowed capital, its financial structure is unbalanced, and it may have to pass on investment opportunities due to the difficulty of obtaining loans.

"Therefore, raising the proportion of equity contributed by shareholders should be a solution for long-term positive cash flow," said Trung.

According to Trung, if enterprises have a clear business strategy, competitive advantages and their products and services have been trusted for a long time, customers are the best source of quality investors.

Nguyen Quoc Trung delivers an opening speech on the first trading day of CFM Investment JSC in the UPCoM stock market. Photo by CFM

Trung said that in 2021, a CFM member established a chain of grilled hot pot restaurants. He raised VND10 billion to assist the company to overcome Covid-19 difficulties and even expand the business by opening a chain of coffee shops.

For a restaurant that needs around VND5 billion in investment, the company sold its shares to 50 shareholders, each investing approximately VND100 million.

After becoming shareholders, customers are more engaged in supporting the marketing and sales of the restaurant.

"Shareholders will regularly prioritize choosing this restaurant to have business meetings or recommending it to their friends," said Trung.

According to the CFM's representative, enterprises need to be transparent in their business activities and comply with the law when raising capital.

CFM also connects its customers with accredited securities companies and leading independent auditors to jointly build the financial roadmap from an SME to becoming a public company in the stock market.

CFM Investment Joint Stock Company was established on August 7, 2017, with seven founding shareholders, and a charter capital of VND20 billion. The main businesses of the company are training and financial restructuring consulting. CFM became a public company on December 16, 2020.