Beware… This article contains the “F” word and therefore may cause offence. The “F” word in question is of course FINANCE!
Clients regularly ask me how they should go about trying to raise finance.This article provides some practical steps as well as some important considerations around raising funds.
The first step is to ensure that you have a good proposition for any prospective financier.
OK… So what is a “good” proposition..?
1) You need to have a business plan. Without one of these you pretty much have no chance of securing funding so if you don’t have one… Get started!
2) You need to demonstrate knowledge of the business – for example the target market, competitors and industry trends.
3) The cash…. How much you need? Why? How long will you need it for? How will you spend it? How (and when) will you be able to repay it? If you underestimate the financial requirements you’ll appear to have misunderstood the finance requirements of your own business and the answer given by your lender won’t be the one you want to hear!
If the cash is for use as working capital do you need the money in one lump sum? If not why not negotiate for the release in stages subject to hitting pre-defined milestones thus reducing the lender’s risk.
Are you contributing any of your own funds? This demonstrates commitment to the venture in that you are prepared to put your own assets at risk.
Finally, I’d suggest not going it alone. Contact a business support agency as they are likely to have the latest information regarding funding sources and may also be able to assist with developing a comprehensive business plan if necessary.
I wish you the very best of luck!
About the author
An entrepreneur at heart, Andrew Salmon started and ran his own successful IT business for a decade before successfully executing a harvest strategy. Afterwards he worked with an international E-Learning organisation providing a learning portal to educational authorities and private institutions across Australia, USA, UK, South Africa, New Zealand, Hong Kong & Papua New Guinnea, serving over five million students.
For business support call My Business Coach on 0845 862 2058 or visit www.mybusinesscoach.org.uk