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Nobody is as powerful
as we make them out to be.
Alice Walker,
Writer |
Tackling a business funding strategy can
feel a lot like herding a pack of cats. The more dynamic your
business is, the truer that becomes.
And it doesn't get any easier as time
goes on.
Whether your business is in the planning
stages, or has been in business for several decades, there are a few
preliminary steps you need to take before you step in front of a lender or
investor.
Step One: Figure out where you are.
This isn't as easy as it sounds.
While there are some general guidelines in the development of a company,
there are wide variations on the them. For instance, a company
that has been around for five years hasn't necessarily established
itself in its industry. It could be still investigating its
product, as with most biotech firms.
So take a reality check. List out
everything that you have accomplished to date, such as
- filed three patents
- established two national territories
- created Advisory Board with seven
very strong members
- hired a design firm to design
packaging
- increased sales by 38% in second
year
- identified new market for service
- landed 18 strong corporate clients
Note that there is nothing about
"hiring people" or "moving into new quarters". Those are things
you have to do to make things happen. What you want on your list
are those things that really happened -- real accomplishments.
Step Two: Figure out where you want
to go
You would think that everyone has this
part of their business funding strategy figured out. But they don't.
Sure, everyone wants Success. But what defines that Success?
Does making $X in sales create success?
Does affiliation with a large company
make yours successful?
Does winning the Nobel Prize make your
company successful?
Whatever it is, define it. (The
Nobel Prize is probably out of line. Let's keep this sort of
realistic.)
Step Three: Figure out how to get
there
If you've done a good job in Steps One
and Two, this should be a piece of cake.
Either you're on the right path, or
you're not. If you're not, fix it. And if you can't fix it,
either close up shop or figure out what your goal really should be.
You should now know what type of business
funding strategy you need to put in place. Short term? Long
term? Credit based? Equity based? Some conglomeration of
alternative financing?
Whatever it is, it will be the absolute
best funding strategy for your company at this point in time.
Next week, when you get an unexpected
huge order, all this planning will be for naught. But, hey, that's
the joy of being in business.
.
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