I think that money or the lack there of makes most people apprehensive about starting their own business. However, there are dozens of ways to get around this problem. Though its not so easy to get someone to give you large sums of money, it's more possible than people think, myself included. Cindy and I were lucky enough to find a couple who believed in our idea and in Hemma's potential and chose to invest in our company! Best of all, they not only invested monetarily but are investing time, resources, ideas etc. This brings me to a very important point, Once you do have investors or know potential investors, you should ask your self :
- Do I get along with them as people? (You will most likely be spending large amounts of time sharing and communicating with them)
- Do they share my motivation and drive to make the business a success?
- What are you looking for in an investor?
- What do they want out of the deal?
Its very important to find a good fit between you and your investor because hopefully they will be someone who shares more than just money with you (ie: information, knowledge, experience).
Cindy and I thought about these questions and what was important to us, before we even found investors so that when we did, we were prepared! Prepare for opportunities, so that when they appear, your ready! Its more than just being at the right place at the right time.
What we did when searching for investors:
- INTERNET RESEARCH: We searched for grants in all fields we thought would apply. Who would give you money? Be very inclusive and search broadly at first not only specific to your industry but specific to who you are (ie: student, woman, person of color; were just a few of the criteria we looked into).
- YOUR FAMILY: The closest people to you, who would probably be very supportive of you doing such a courageous thing like starting your own business. Ask them for money: parents, granny's, aunts, uncles.
- USE YOUR NETWORK: Whether you are a student, employee, parent etc, use yoru network of people. They may be potential investors themselves or more likely than that is that they will know someone who would be interested in investing. Tell as many people you can about your business! You have to basically become your company, its biggest fan and cheerleader. The more people you tell, the more people will hear about your company and possibly want to contribute. That is pretty much how we met our investors.
- READ as much as you can about business related issues, including tips on effective ways to get investment for your specific industry. One publication I would recommend is Inc. Magazine, read the magazine or articles online, its great for the new business owner! I also recommend SBA another organization that helps small businesses with a wide range of services from loans to counseling.
- YOURSELF: Cindy and I invested our own capital at Hemma's inception and we did so willingly because we both really believed that we would see a return. We had both just graduated college when we decided to start Hemma, so we were not at all financially established, but that goes to show that you do not necessarily need large sums at the inception of your company.
- HAVE A BUSINESS PLAN:
- Learn how to write a business plan by internet/book research and by looking at templates online or from friends
- Be very detailed when writing
- It's OK to not have all the answers about your business at the very beginning of writing your plan, the more you research, the clearer they may become
- Make the cover and writing style within very professional and concise
- A business plan is your way to convince someone that you have a great product, service or idea so treat it as such!
So now your ready to move your business to the next level. Good luck!!
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