By Tim Scott
You have a revolutionary business idea – an innovation that will change the world! You just know people will knock down your door to buy your product … but you need some financial support to make your dream a reality. So, what’s next? Do you go to your local bank and share the good news? Do you talk to your friends, neighbors and family about your prized idea? What about finding one of those Angel or Venture Capital investment companies who have all the money and ask them to help out? You could, but actually finding funding for your product or idea should really happen in the later stages of your planning – think if it as Stage Two. First, let’s look at the elements of Stage One – Your Plan.
A strong plan is critical if you want others to buy into your idea, so let’s break down the “Top 10 Things You Must Do to Secure Funding for Your Business”.
Number 10 Have a detailed Business Plan
I’ve worked with a host of companies over the years that completely overlook this necessary step. A Business Plan is a detailed document you prepare to outline everything about your business; management team, market, product offering, financial overview, etc. Yes, I know, preparing a Business Plan is a huge effort. But that’s the point. Without all the effort and subsequent detail that comes from researching, writing, and evaluating, you will miss key information – those ‘ah-ha’ moments you will undoubtedly experience while preparing a plan. There are a number of business plan templates you can download from the Internet. Get searching and start building your plan.
Number 9 Be clear about your Financial Requirements
How much support do you need? How will the funds be used? Can you identify an appreciable difference that ‘X’ dollars vs. ‘Y’ dollars will have on your company’s success? The expectation of any lender, whether personal or institutional, is that you have explored every option, considered all the pluses and minuses of your funding requirements, and have settled on the most optimum financial need to support your company path.
Number 8 Create an Elevator Pitch
Can you to describe your business idea in 30 seconds or less? It may sound challenging, but taking the time to craft your story – who you are as a company, the products or services you provide and who you’re selling to – will give you the ability to clearly articulate your need. Be succinct, be engaged, be a leader and be you. Lenders will buy into you as much as the product or idea you have. Clear communication leads to action.
Number 7 Present the strengths and weaknesses of your Management Team
Take a critical view of you and your team. Do you collectively have the requisite skill sets to make your plans happen? Where are the gaps in your team – experience, education, and knowledge – and what will it take to fill those gaps? Lenders not only review your business plan, they also look at the leader and management team to see if the planning can be executed. If you don’t have an accountant, find one who understands the ins and outs of financial planning – one that can help you successfully navigate the lending minefield. Whether you have the necessary skills to lead this new venture, or not, be transparent with your lenders.
Number 6 Define your Business Strategies
Arguably, this is the most difficult element of the planning process to work through. Too many times individuals or companies take short-cuts and don’t define exactly how they plan to move forward. Take the time to identify the vision you have for the product, and be sure you create an execution plan – complete with specific activities and strategies you will deploy to achieve your vision. Most importantly, define how you plan to monitor the entire process. The stronger the business strategy, the easier it is to keep your company tracking to your plan.
Well, that’s all for now. My next post will include the final countdown to the all-important Number 1 – the must-not-miss information that will help you succeed in securing that ever-evasive funding.
Of course, if you can’t wait, you can give me a call, Tim Scott, Entrepreneur-In-Residence at the RIC Centre to discuss your revolutionary business idea in person! You can reach me at 905-273-3530 or email me at firstname.lastname@example.org
The RIC Centre (Research, Innovation, Commercialization) is a non-profit organization that provides business and technical services to small and medium enterprises (SMEs) to commercialize their innovation. Tim Scott is the RIC Centre’s Entrepreneur in Residence. In his capacity, he meets with early stage companies and advising them on moving their business models to the next level. RIC’s interests reside in the aerospace, advanced manufacturing, emerging technologies and life sciences sectors. Visit www.riccentre.com for more information.