Raise the $takes for Success
Raise the $takes for Success
Step 1: Ask yourself the right questions
· When do I need money?
· What do I need it for?
· How much do I need?
· How long do I need it?
· Where do I get it?
· How do I repay it?
Step 2: Make realistic assumptions
You don’t have to be a fortune teller to answer these questions. You need only make educated guesses. Complement your own knowledge with the best information you can find. Tap your contacts or search online. The more realistic your assumptions are, the more believable they’ll seem to business funders.
· When do I need money? (business development schedule)
It’s smart to set goals on a calendar or spreadsheet schedule, so you can make your assumptions for each stage of business development in advance. Start by projecting the first 12 months. You know you’ll need seed money to set-up your business and cover overhead until cash flow is positive. How much you’ll need in Month-1, and whether you’ll need additional cash infusions along the line, the following answers will tell.
· What do I need it for? (uses of funds)
You need to fund operating expenses, such as workspace rental and utilities and insurance, equipment lease charges (or financing costs, if not outright purchases), telephone and network charges, salaries and benefits, legal and accounting fees, plus miscellaneous expenses. If you sell goods, you need to purchase or produce the inventory sold in each period. And you need a marketing budget.
· How much do I need (liquidity)
At the very least, you need the excess (if any) of total cash outflows (expenses and purchases) over total cash inflows (sales receipts) in each period
· How long do I need it? (short-term, long-term)
Until cash inflows meet or exceed outflows, you need short-term funding (typically, a line of credit or a working capital loan or business development grant) to cover cash shortfalls. Long-term financing is usually associated with purchasing long-lasting assets – equipment or buildings, or even an existing business or a franchise.
· Where do I get it? (sources of funds)
After own money (YOM), the usual sources of other people’s money (OPM) are: family and friends (‘love money’), government grants, angel investors, merchant banks, venture capital funds, and chartered banks (which may offer you a business credit card to get started).
· How do I repay it? (debt service and/or return on investment)
Generally speaking, short-term debt gets repaid in 30 to 60 days as sales receipts are deposited in your revolving credit account. Long-term loans are services on a monthly or quarterly schedule. Grants are outright gifts, and ‘love money’ may have no no fixed repayment schedule.
Step 3: Prepare a believable plan for success
Like family and friends, outside funders must believe you can succeed, before handing over the money you need to make money. But they don’t know you like your intimates do. So they base their belief in your financial projections, largely on your plan for success. Make your business management plan and marketing plan as realistic as your money plan. However grand your dream, before you risk YOM, never mind raising OPM, make sure you believe it can come true.
Raise the $takes for Success - To learn more about this author, visit Marvin Garellek's Website.
Like this article? Share it with your friends
Few successful entrepreneurs would make their first million, or even part of it, if they had to make it with their own money alone. If you’re dreaming about joining their ranks, but in the dark about raising the stakes, read on to see the light on the first steps to funding success.
Step 1: Ask yourself the right questions
· When do I need money?
· What do I need it for?
· How much do I need?
· How long do I need it?
· Where do I get it?
· How do I repay it?
Step 2: Make realistic assumptions
You don’t have to be a fortune teller to answer these questions. You need only make educated guesses. Complement your own knowledge with the best information you can find. Tap your contacts or search online. The more realistic your assumptions are, the more believable they’ll seem to business funders.
· When do I need money? (business development schedule)
It’s smart to set goals on a calendar or spreadsheet schedule, so you can make your assumptions for each stage of business development in advance. Start by projecting the first 12 months. You know you’ll need seed money to set-up your business and cover overhead until cash flow is positive. How much you’ll need in Month-1, and whether you’ll need additional cash infusions along the line, the following answers will tell.
· What do I need it for? (uses of funds)
You need to fund operating expenses, such as workspace rental and utilities and insurance, equipment lease charges (or financing costs, if not outright purchases), telephone and network charges, salaries and benefits, legal and accounting fees, plus miscellaneous expenses. If you sell goods, you need to purchase or produce the inventory sold in each period. And you need a marketing budget.
· How much do I need (liquidity)
At the very least, you need the excess (if any) of total cash outflows (expenses and purchases) over total cash inflows (sales receipts) in each period
· How long do I need it? (short-term, long-term)
Until cash inflows meet or exceed outflows, you need short-term funding (typically, a line of credit or a working capital loan or business development grant) to cover cash shortfalls. Long-term financing is usually associated with purchasing long-lasting assets – equipment or buildings, or even an existing business or a franchise.
· Where do I get it? (sources of funds)
After own money (YOM), the usual sources of other people’s money (OPM) are: family and friends (‘love money’), government grants, angel investors, merchant banks, venture capital funds, and chartered banks (which may offer you a business credit card to get started).
· How do I repay it? (debt service and/or return on investment)
Generally speaking, short-term debt gets repaid in 30 to 60 days as sales receipts are deposited in your revolving credit account. Long-term loans are services on a monthly or quarterly schedule. Grants are outright gifts, and ‘love money’ may have no no fixed repayment schedule.
Step 3: Prepare a believable plan for success
Like family and friends, outside funders must believe you can succeed, before handing over the money you need to make money. But they don’t know you like your intimates do. So they base their belief in your financial projections, largely on your plan for success. Make your business management plan and marketing plan as realistic as your money plan. However grand your dream, before you risk YOM, never mind raising OPM, make sure you believe it can come true.
Raise the $takes for Success - To learn more about this author, visit Marvin Garellek's Website.
Like this article? Share it with your friends
 | |
 |
No article feedback found. |
| |
Leave Your Feedback |
 | |
| |||
Dianne CramptonDianne Crampton is an executive leadership coach, team consultant, author and president of TIGERS Success Series, Inc. Dianne has been helping CEO's and Executives connect their employees to their core values and goals for over 20 years using the trademarked TIGERS team culture process, which stands for trust, interdependence, genuineness, empathy, risk and success. To download a free white paper on behaviors that build strong teams and behaviors that will predictably tear them down go here. - Visit Dianne Crampton's Website |
|||
Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
|||
Linda RichardsonLinda Richardson is the Founder and Executive Chairwoman of Richardson, a global sales training and performance improvement company. As a recognized leader in the industry, she has won the coveted Stevie Award for Lifetime Achievement in Sales Excellence and she was identified by Training Industry, Inc. as one of the “Top 20 Most Influential Training Professionals.” Ms. Richardson is credited with the movement to Consultative Selling and is the author of ten books on selling and sales management, including Sales Coaching — Making the Great Leap from Sales Manager to Sales Coach, and Stop Telling, Start Selling. She teaches sales and management at the Wharton Graduate School of the University of Pennsylvania and the Wharton Executive Development Center. Linda is a frequent speaker at industry and client conferences, has been published extensively in industry and training journals, and has been featured in numerous publications, including The Wall Street Journal, Forbes, Nation’s Business, Selling Power, Success, and The Conference Board Magazine. Learn more about Richardson's sales training and performance improvement solutions at http://www.richardson.com web - Visit Linda Richardson's Website |
|||
|
To learn more about the Evan Elite Author Program please contact us. | |||
 | |
|  |
Subscribe to Marvin's articles
 | |
|
|  |
 | |
|
| |
 | |||||||
|
 | ||
|
||
 |
||
 |
||
|
| ||
 |
| Have you written articles that would be of value to entrepreneurs? Become an expert on our site by publishing them! Expose yourself to a wide audience, drive more traffic to your website and get more sales! Click Here for details. |
|
|
 |
| Modeling the Masters: Learn the true secrets behind Walt Disney's business success factors & grow your company! Video produced by Phanta Media |
|
|
 |
"Learn straight from Evan how you can Make a Full Time Income (And More) from a Website"
Click Here To Learn More |
|
|
|
|
Get advice & tips from famous business owners, new articles by entrepreneur experts, my latest website updates, & special sneak peaks at what's to come!
|
|
|
 How to Get a Life Positive Thinking Why MLMs Fail Basic SEO Guide Networking Impacts Income |
|
 | ||
 |
Top 50 Blogs For Startups
Top Blogs To Watch In 2009 | |
 |
Top 50 Niche Blogs 2009
Top 50 Niche Blogs 2009 | |
| ||
 | ||||
| ||||
|
| ||||
| ||||
|
|
|
|
|
||||||||||||
|
Email us your ideas on how to make our website more valuable! Thank you Sharon from Toronto Salsa Lessons / Classes for your suggestions to make the newsletter look like the website and profile younger entrepreneurs like Jennifer Lopez and Sean Combs!
|
|
|
