Deborah Kimmett is a Gold Author on EvanCarmichael.com – to view her articles click here. We asked her how she use social media to grow her business – here’s what she said:

Stan Prokop is the founder of 7 Park Avenue Financial. The firm specializes in business financing for Canadian companies in the areas of working capital, asset based lending, SR & ED tax credit financing, equipment financing, franchise financing and banking.

He’s also a Platinum author on my website – you can check out his articles here.

We asked Stan his professional advice on Little Known Methods of Financing Business and here is the complete interview:

New and existing businesses are always looking for capital.  Although a solid majority of business owners, managers and entrepreneurs know where to look, many can’t make that claim. Additionally there are a number of little known ways to finance a business that are not as ‘main street ‘as the obvious choices – our Canadian chartered banks, etc.

We suppose if the entrepreneur/owner knew exactly what to do all they would need is the Yellow Pages and a phone; however that is not the case.

Looking for financing methods requires that you immediately ‘slot’ your needs into one of two buckets – equity, or debt. Naturally the SME sector in Canada is not funded from an equity perspective via our banks. Simply – they don’t do that!

The other natural tendency is to take the government up on their offer of assistance. Like you, we’ve seen the commercials!  When it comes to real world access to government funding we work with our clients in two areas – The federal government SBL loan, and SR&ED tax credit financing. Either of these two are tremendous ways to help finance your business, particularly in the early stages.

Some other methods of equity financing in early stages include  angel investors,  reverse takeovers of public companies with cash and no business currently inside them,  and the newest kid on the block , ‘ Crowdsourcing ‘ . (It’s our understanding you simply ask 1 Million people for 1$!)

In Canada there are a number of Community Futures programs which fund regional development via loans. It’s our experience these loans have never provided the business owner with all that they need, an alternative financing is also required.

Many business people aren’t aware of Royalty financing, it’s an innovative way to promise future payment via future sales. You just need the confidence you can make those sales goals from your lender.

At 7 Park we focus on the more common methods of financing a business – including:

A/R finance

Working Capital Term Loans

Equipment finance / Sale Leasebacks

SBL loans

Asset based lines of Credit

Revolving bank facilities

Etc.

1) What are the biggest challenges encountered in financing a business?

When examining debt financing options challenges that business people need to address include:

The need for hard assets which can be collateralized or monetized

The need to give up assets as security for debt type financings

Ensuring that your business assets have real value – i.e.  Realizable receivables, sales growth, quality inventory turnover, etc

When you are looking for equity financing, which is not our specialty at 7 Park Avenue Financial the mindset of the investor (not a lender) changes. They want   technology or businesses with a proven competitive edge, strong growth potential, sensible exit strategies.

2) What are the things you should avoid when financing a business?

At 7 Park Avenue Financial we’re always cautioning our clients to separate their personal finances from their business finances. Tapping significantly into registered savings plans is by far not the best funding option if you can access other options.  And by the way, debt is cheaper than equity – look into that comment!

3) How will you document the financials of the business?

This is a great question. Documenting your financials via a realistic business plan and cash flow forecast is key. Just being able to answer simple questions  such as ‘ how long will it take you to collect ‘,  ‘ are your costs in line with others ‘ ‘ how will you market your product or service ‘ are key to winning over a lender or investor .  You have to be able to estimate reasonable sales and show a cash flow that shows ‘how your company works!”

4) What are the necessary skills you should possess to run this business efficiently?

Operating and financial management skills are key to how you will be perceived and dealt with by lenders and investors. Your management and financial skills must be clearly evident to lenders, either through your financial track record in business, or in person meetings to present your firm. If your company is perceived as ‘incomplete’ when it comes to key personnel you will never get the full financing you need at rates, terms and structures you want.

Stan Prokop is the founder of 7 Park Avenue Financial. The firm specializes in business financing for Canadian companies in the areas of working capital, asset based lending, SR & ED tax credit financing, equipment financing, franchise financing and banking.

He’s also a Platinum author on my website – you can check out his articles here.

We asked Stan his professional advice on how to tell if your company is doing well and here is the complete interview:

1) How can you tell when a business is doing well?

Business owners and managers that are ‘non financial’ in their backgrounds often need to know how to ‘‘scorecard’ their business. They want to know how to make intelligent decisions about both running their business and moving it forward.  At the end of the day the owner/manager wants to know they are managing their assets properly in a manner that allows them to grow and profit.

It might seem improper to answer a question with questions but at the end of the day the business person needs   to have a solid handle on some key basics. They might include:

Are we financing are current assets (A/R and inventory) properly?

Can we take on more debt or would it be actually necessary to bring in new ownership equity?

Do we have proper operating efficiencies when it comes to collecting our accounts or turning inventory over?

If the owner/manager understands the relevance of those questions and where to seek answers they are definitely on the right track to doing well.

A key secret to doing well is in what we have termed ‘relationships ‘. Many call them ratios – but if you understand the relationships between just some key numbers in your financial statements that revolve around profit, efficiency and solvency you are absolutely on the right track to doing well.

A quick example? Let’s focus on ‘profit ‘. Take your total profit for the year and divide it by the assets in your business. It’s a simple arithmetic calculation. No financial degrees required.  It’s a measure of how you’re using the assets in your business relative to the profit it generates. All industries have different results based on capital intensiveness, etc. So if you think you’re different, you are! But not when compared to others in your industry. Lenders and investors will look at this simple comparison to justify loans or new equity.

One final point on doing well. The numbers in your financials don’t always provide answers – but they can provide some great questions, which you need to address!

2) What are the signs of a business doing poorly?

While many people use sales /revenue as a yardstick of success we ourselves are a bit to financially oriented to focus just on that. Solvency is therefore important. When you can’t pay bills or suppliers a whole lot of business distress starts to take place.

That’s when it time to focus on a ‘back to the basics ‘strategy that might include improving liquidity by refinancing. Many companies are doing poorly because they simply have too much debt relative to their asset base.  Lenders such as banks have some basic ‘yardstick ‘measurements when it comes to cash flow and the amount you can borrow. If you don’t meet those yardsticks lending is curtailed and your company has the risk of entering into the ‘death spiral ‘that we read overtakes many firms.

If your client base is drifting away and owners and shareholders are dissatisfied it’s time for the business owner to assess the problems.

3) What steps should entrepreneurs take when your business is not doing well?

Business owners need access to good data when the company is perceived internally or externally as not doing well. Key focus on sales, financial controls and availability of financing become key. Objectives at this point have to be realistic, allowing the business to handle challenges of not doing well because of general economics or operations.

It’s all about understanding your financial position, and using that data to address the particular challenges you’re facing.   We come back to  ‘relationships ‘ again ; that could be focusing on cash flow strategies, analyzing cash outflows , looking at inventory controls, and rationalizing headcount .

4) How you can prevent your business from failing?

There’s of course no guarantee regarding business failure. One factor that we see often is that many businesses equate sales and profits as ‘cash flow ‘. That kind of thinking has led to some of the greatest financial debacles in business history – so we always encourage clients to have a solid handle on that difference – and it’s a large one. We can jokingly say that to avoid all future cash flow problems we encourage owners and executives to compensate sales staff on collections – but that has never really gone done well!

5) Who can help get a business back on the right track after failing?

While you can pay  turnaround experts and consulting firms  large amounts to  get your company in turnaround mode the reality is that in many cases the business owner and manager has access to a lot of quality information in their own networks of accountants, lawyers,  peers , bankers, etc . Getting credible advice from trusted, experienced parties never has to be expensive or time consuming. While our firm, 7 Park Avenue Financial focuses solely on business financing we have found ourselves spending countless hours in helping clients achieve overall business success through referrals, advice, etc.

Pat Mussieux is a Platinum author on EvanCarmichael.com – to view her articles click here. We asked her for What’s the biggest business mistake you’ve ever made? here is what she said:

Four years ago, when I re-launched my speaking and coaching business, I hired a high-level Marketing coach out of NYC. I was intent on fast-tracking my business and moving forward quickly and consistently. And that happened -in 18 months, I took my home-based business from zero to 6-figures.

Then……the biggest mistake EVER  - in my opinion – I stopped working with her and with any coach for a 6-month period – told myself that I would spend that time ‘implementing’ all that I learned and would get back with a coach after that ‘break’ – well, those 6 months turned out to be a challenge, my business did not grow – I lost focus – and things stalled. Fortunately, I recognized it and got back ‘with the program’ – hired a Sales coach and have since taken the business to multiple 6-figures.

Moral of the story – no one can do it alone! The Lone Ranger syndrome does not support entrepreneurial success. Every entrepreneur needs a coach – should have a coach – and stick with a coach. I will not make that mistake again!

About Pat:

Pat Mussieux is fast becoming regarded as one of the voices for women’s entrepreneurial success. After leaving her 22-year marriage with virtually nothing, and moving across the country at age 55 to start a new life, she re-launched her coaching and speaking business – taking it from zero and growing it into a multiple 6-figure home-based business. Much of her success can be attributed to her expertise when it comes to marketing, mindset and money!
Pat has been featured as an expert in both print media and on TV. She was nominated as one of the 2010 and 2011 RBC Canadian Women Entrepreneurs of the Year; as well, Pat has been nominated for the Chatelaine magazine “Woman of the Year for 2011″. Pat is Founder of Wealthy Women Leaders, and provides business and success advice and resources to clients around the world.
Pat is the author of “The 7-Step Guide To Growing Your Business by Getting Out of Your Own Way “, teaching women entrepreneurs how to get their message out, close the sale, enjoy massive results, and create some simple systems and processes for success!
Through her coaching programs and products, Pat teaches her clients how to experience freedom inside and out and create the life they truly want to live, now! It’s a ‘no-excuses’ approach! You can reach her at http://www.wealthywomenleaders.com

Stan Prokop is the founder of 7 Park Avenue Financial. The firm specializes in business financing for Canadian companies in the areas of working capital, asset based lending, SR & ED tax credit financing, equipment financing, franchise financing and banking.

He’s also a Platinum author on my website – you can check out his articles here.

We asked Stan his professional advice about Business Plan Tips for Entrepreneurs and here is the complete interview:

1) Do you need a business plan for business financing?

At 7 Park Avenue Financial we get that question a lot.  While we can categorically say that certain types of business financing in fact require a solid business plan the Canadian business owner / manager can successfully achieve many types of financing without that document.

Larger more sophisticated financing which might require an equity component certainly almost always require such a plan.  Venture capitalists and private equity lenders focus on the plan with significant analysis and emphasis required on growth and exit strategies which is why they are of course considering the investment in the first place. These documents tend to be very detailed oriented and in effect become the company’s road plan to financing.

A number of business financings can in fact be completed without a plan. They might include equipment financing, receivable financing, tax credit monetization, asset based lines of credit, etc.  These types of debt or monetization finance strategies are often simply completed with detailed application forms and accompanying business information such as financial statements, owner’s financials, a cash flow forecast, etc.

The real answer to the question ‘do we need a business plan ‘in fact is driven by the nature of financing you need and who is providing it.

In certain other financings a plan is definitely required. Start up ventures almost always have a business plan attached to the finance request. We originate a number of Government Small Business Loans for Canadian clients and they almost 100% of the time require a basic business plan.

2) What is a good business plan outline in summary?

There are certain key elements of a plan that are almost always required and in fact help to guarantee favorable notice by the lender /investor. They typically include”

Executive Summary

Company Overview

Competition/Industry Analysis

Product/Service Description/Pricing

Management Overview

Financial Forecasts

We see many plans that in our opinion are either provide so much info that it leads to confusion and questions by the lender/investor .  Talk about a self defeating strategy when the document you in fact intend to generate financing in fact only confuses the issue.  So our advice is to stay clean and concise when it comes to both narrative and financials.

Naturally the lender or investor can well invoke their right to request additional info or clarification, but why confuse things at the outset?  Questions of issues raised by the lender or investor can well help you identify how your company is in fact being viewed.

3) Who prepares business plan?

Business plans are typically prepared by the borrower themselves, a third party, a Canadian business financing advisor, or your accountant.   Depending on the type of plan and the relative size of your financing request   each of these parties can bring a certain level of expertise to the table.

4) How much does a professional business plan cost?

We see the costs of professionally prepared business plans vary all over the map. The actual cost of the plan will often relate directly back to the type of firm or person that prepared it. Our own firm for example typically charges   $1000.00 for a document that relates directly to the type of financing we are originating from the client.

We’ve met many clients that that have spent ten times more for a plan that, although properly prepared, simply was so much more than the client required. One ‘war story ‘we can share is of a medical clinic that approached us for financing. They had spent close to $ 5000.00 on a plan that was not yet delivered in completion, and had found themselves doing most of the work.  So we suppose our advice is that in the world of business plans it’s a case of NOT always getting what you paid for!

We can also add that your business plan preparer must in fact be sensitive to your timelines and more importantly you must impress upon them the nature of the financing or investment you are seeking.

5) What are the common mistakes in business plans?

We have already touched upon some of the key mistakes made in plans – To summarize they are:

-       The plan must contain essential  finance, company and industry criteria

-       You should not over pay for a proper business plan

-       The type of financing or investment you need should dictate the size and quality of the plan

-       The first page of the plan should be clear and concise and catch the lender/investor interest

-       Things that are obvious to the business owner might not be so in the eyes of the investor or lender – put yourself in their shoes

-       Sales projections are not realistic

-       A business plan  is not necessarily for finance or  investing – it’s a great tool for the business owner and manager to look back and scorecard themselves

We can also add that many plans seeking   debt financing are too improperly focused on sales, marketing and the story. A lender is not going to participate in the upside of your business – they do want to see a proper finance and cash flow plan that shows one thing – how they will be repaid.

Susan Baroncini-Moe is a Bronze author on EvanCarmichael.com – to view her articles click here. We asked her for What’s the biggest business mistake you’ve ever made? here is what she said:

The biggest business mistake I ever made happened years ago, when I was working with my first assistant. My mistake was that I waited way too long to fire her.

I take great care in hiring—more so now than I did back then—and my team and I do a lot to make sure that new hires are good fits for the job they’re given. That said, there’s still a certain amount of unpredictability when you hire someone new, and it’s almost impossible to know for sure if they’re going to work out.

That assistant was pleasant to work with but she made a lot of mistakes, and mistakes by an employee or contractor can be costly in more ways than you might imagine. Sure, you’re spending money on a contractor or employee who isn’t doing a good job, and that can feel like a waste, but more importantly, this assistant was actually damaging my brand.

The “hire slow, fire fast” mentality has become pretty popular in entrepreneurial circles. I do hire slow these days, but I never have “fired fast” and I don’t think I ever will. Unless the person makes a lot of mistakes and has a generally poor quality of work, I have a talk with them to see if there isn’t an available position that’s a better fit. If we can’t find a job that suits them better, then I let them go.

What’s important about this, though, is that I don’t wait so long before making a decision about what I’m going to do. Years and experience have taught me that it doesn’t take very long to see if a person isn’t going to be right for a position, and instead of waiting for a couple of months to see if things will improve, it’s better to make a decision and take action as soon as you see there’s a problem. Had I acted more quickly back then, I could’ve saved myself a few headaches and a lot of time spent in fixing the mistakes that assistant made. I am glad I had that experience, though…sometimes it takes making a big mistake yourself to learn the most important and valuable lessons in business.

About Susan:

Susan Baroncini-Moe, author of the upcoming book “Business in Blue Jeans,” due out Spring 2013, is the founder and president of Business in Blue Jeans, a business and marketing coaching/consulting firm focused on the needs of entrepreneurs and small business owners. Susan is also the CEO of American Business Partners, an Indianapolis-based business and marketing consulting firm focused on assisting service-based professionals and companies with startup and logistics, team-building, branding, marketing and social media, corporate culture-building, product and service development, and overall business fundamentals and strategy. A veteran of the web industry, Susan leverages her unique fusion of business and technological knowledge, her experience in the personal growth industry, and her incredible brainstorming capabilities to transform businesses around the globe. She is a sought-after strategist and public speaker and holds a Guinness World Records title.

Click here to visit Susan’s website.

Peter Winick is a Silver author on EvanCarmichael.com – to view his articles click here.  We asked him for his #1 Tip for Entrepreneurs, here is what he said:

In today’s fast moving, uber-connected, globally competitive world it doesn’t matter what you are selling or whom you are selling to; almost everything has been or can easily be commoditized. And that’s not a good thing for an entrepreneur.

So how do you, as an entrepreneur, differentiate yourself and your products or services? Why is yours a better mouse trap? Why should anyone care or listen to what you have to say? Why should a prospect take on the risk of working with you, a new supplier? You have a good shot of winning the business if you don’t make the mistake that most do when communicating what you do or sell – focusing on the features, NOT the benefits of your product or service.

You need to position your products and services as providing an easy to understand benefit to a customer or client. Telling them how many mghz or horsepower or gigs or whatever your solution has is often meaningless and confusing to them and results in them tuning out rapidly. Letting them know that because product X has 22% more mghz than the competitors and that allows the user to DO something quicker, better or cheaper than they’ve currently been able to is something they would care deeply about.

Buyers don’t care how many offices you have around the globe (that’s a feature). They do care that as a result of having offices around the globe your organization can respond to their needs within 2 hours (that’s a benefit).

All too often entrepreneurs are too close to their own stuff and lose the empathy and customer-focus you need to be able to cut through all of the clutter and noise that exists in the marketplace today. Your goal is to eliminate the noise and highlight the signal. Everyone is busier than they’d like to be and is looking for products and services that make their lives easier, BUT they don’t have the time or energy to spend sifting through clutter to be able to understand what that might be. You need to make it super easy for them to get the benefit and why that benefit makes their world better.

Communicating the benefits in the form of a story is by far the most impactful way to get your message across. Human beings are wired to respond to stories better than raw data and statistics. They connect intellectually and emotionally to stories. They can relate to stories and visualize themselves benefiting from what you have to offer when you can craft a story that effectively communicates the benefits of what you do. Stories engage people, draw them in and allow them to visualize value. If you can craft a benefit rich story that communicates in a  no-nonsense way why your offering makes your target markets life better, you’ll win more customers more often than if you go down the path of speaking in feature rich language that gets lost in the crowd.

About Peter:

Peter Winick has over twenty years of experience enabling thought leaders, authors and gurus to monetize their content through books, keynote speaking, the creation of training services, consulting and assessment tools. From the strategic stage to marketing and sales implementation, Peter helps companies use thought leadership as a strategic marketing tool that drives business results.

Click here to visit Peter’s website.

Katrina Sawa is a Gold Author on EvanCarmichael.com – to view her articles click here. We asked her how she made her first sale – here’s what she said:

What’s your #1 tip for entrepreneurs?

While there are so many tips I want to share, the big one that comes to mind that affects most small business owners I see from reaching their full potential is to stop trying to do everything yourself.

Stop trying to figure everything out.

Stop trying to learn how to do everything in your business yourself such as:

• designing a website
• writing a press release
• designing your logo and marketing materials
• writing your own contracts
• doing your own bookkeeping
• and so much more

It’s crazy how many hats we have to wear as business owners but you’ll get no where fast if you try to literally wear them all yourself.

You also won’t see the amount of revenue you dream about seeing if you do this either. It’s just not physically possible to do EVERYTHING that has to be done to start, grow, run and market a successful, smooth-running, moneymaking business.

Instead, surround yourself with people who can support you in areas that are not your expertise. Hire professionals to make you look good. Rely on individuals who are smarter and faster at doing things you aren’t so good or efficient at doing.

The sooner you stop being a control freak in your business or being scared that you can’t afford such help, the sooner you’ll see bigger monetary results.

Here are a few tips to get you started on who to hire or what to outsource:

1. The first thing a business owner usually needs is at least a business card and a website. Other marketing materials can typically wait. You can generate leads offline and online when you have both of these things professionally designed.
2. The second thing a business owner typically needs is a second set of hands. That could mean a set of hands to help you with home help if you work from home; maybe a nanny, housekeeper or landscaper to start? If you’re fine at home so far then usually its someone to help you manage your paperwork, administrative work, organizing your office or implementing marketing strategies from your marketing plan. All of these could be crucial to your success but if you need to make money now, I recommend getting the marketing plan and person to implement it in place first.
3. Thirdly, a business owner may need legal matters in place or financial documents in order and these are areas you definitely don’t want to mess up with mistakes that you could make.

For a list of recommended resources, contractors or services to assist you, the small business owner, visit http://www.jumpstartyourmarketing.com/resources.

About Katrina:

Katrina Sawa is known as The JumpStart Your Biz Coach because she literally kicks her clients and their businesses into high gear.  She works with highly motivated women entrepreneurs that want to maximize their business to make more money, enjoy more free time and fully embrace your happiest life ever.  Katrina uses online and offline strategies to leverage your resources, contacts and your expertise; plus she kicks you in the butt to implement it all too!  Katrina is an author, speaker and coach and she has been featured on the Oprah and Friends XMRadioNetwork and is a regular Business Expert on News 10 in Sacramento.  Get her Free Entrepreneur’s Success Kit online at www.JumpStartYourMarketing.com!

John Perrin is a Gold author on EvanCarmichael.com – to view his articles click here. We asked him for his #1 Tip for Entrepreneurs, here is what he said:

Number one tip for entrepreneurs

Unfortunately my number one tip isn’t going to be about the general entrepreneur consensus of break things and move fast or have all night hackathon sessions to create the next big app.

It’s boring but the reality of it is sales is actually the only reason you look for growth in business, it’s the reason you’re still running today and hopefully 3 years down the road. Many entrepreneurs (mostly in the tech sector) seek growth figures by number of sign-ups, downloads, returns, visits etc forgetting that the end goal of every single one of these numbers is the number of sales made.

Put it simply without sales you’ll never see growth or at least struggle with it, not for getting the endless pits of debts that accompany a business with no sales. What makes a sales strategy or focus great is that it’s so malleable it can be aligned to match any new product or pivot you choose.

Setting up a sales strategy outline early is a good practice to get into as time progresses and your business expands you’ll have very little time to consider how you should be structuring the process. Last year David Sacks, much to my delight, said this “When we first started, I had this naive view that sales would just take care of itself–people would just pull out their company credit card and buy.”  – in this article.

What pleased me was the fact that someone in the Silicon Valley hype realised that sales was a fundamental part of the company’s survival but David also mentioned that he was in fact naïve about it all.

Put it this way, if you’re an entrepreneur that’s building something which will without doubt seek investors in the future you’ll be far, far better off having a solid sales strategy than nothing at all. Sure having investors on board who know the in’s & outs of sales is going to be great but why not give yourself a head start and give the investors a reason to jump and shout – solid facts, data and numbers will always over power a dream.

Consider a sales strategy/revenue plan as a piece of mind for both you and any potential investors as you seek growth. Like many startups and entrepreneurs a new company is solely about growth but finding that may be harder than it seems, you’ll then have an awesome sales strategy gliding in the background ready to step in.

Think you can grow without sales? Chances are it’ll be nearly impossible. Think about the sales strategy early; just create a simple outline that doesn’t revolve around your enthusiasm for product or company.

You’ll be the number one sales person for your company for some time time but again this is only a short term strategy, think like a corporate company but act like an agile startup – once you start bringing people on board you’ll have a complete layout for exponential growth through a brilliant sales strategy.

About John:

John Perrin is the Owner & Director of Tactical Sales Training where we offer courses in sales management training, telesales training, field sales & be spoke training courses. Founded Solid Solutions Management in 1998 with the aim of capitalising on the significant market opportunity for next generation CAD solutions. Became the UK’s leading SolidWorks reseller in 2003 and has since remained the UK’s No.1 SolidWorks reseller. SSM is now one of the top 10 global SolidWorks resellers, from a population of 350 companies. Revenue in 2009 10 Million Successfully exited business in May 2010.  I’m a highly motivated sales trainer who specialises in helping B2B Sales Professionals take their performance from good to great. I convey proven, exceptionally effective selling methods that cut to the quick and consistently yield superb results. I’ve worked with businesses throughout the world to successfully overcome the various challenges that they face in their market place.

Click here to visit John’s website.