If you have a business idea which you feel could one day become a success, the first place that you need to start is ensuring that you have sufficient money behind you in order to take your idea to market. It is a well known fact that over 50% of new businesses fail within their first three years and the most common factor as to why this is, comes down to a lack of finances. With that in mind, it is well worth investing the time now to ensure that you have a solid financial foundation from which you can launch your business. In order to ensure that you have the money that you need, we spoke to business guru Eugene Bernshtam to find out what what you should be doing.
The first job on your search for funding is to work hard on your business model and ensure that you have something which you can present to potential investors. A good business model should talk about the product or products that you are selling, what the target market is, the price and how you plan on selling the business. You should base this information on research that you have already carried out, as well as though testing the product which you have. If your business plan is not on point, you can’t expect anyone to feel confident enough to invest.
Wealthy people who invest in startups are known as angel investors and these men and women could be the key to you securing the investment that you need to get going. There is no ‘center for angel investment’ so if this is what you are looking for then you need to seek out people within your niche, who are looking to invest. In order rot do this you need to cold call and get creative with how you make contact with these people. Once you have secured a meeting, you will need to be able to speak freely and informatively about your product and now your business model and your projections inside out. Usually you will give up a small percentage of you business in exchange for funding so you should have a figure in your mind before entering the meeting.
Banks have been helping businesses to get off the ground for a very long time and they have areas of the bank which specialize in this. In order to secure a loan from the bank you will need a solid business plan and something to put down as collateral on your loan. Bank loans differ greatly from personal loans as most of the repayment is done towards the end of the term, giving you the perfect chance to use the first few years to try and turn your business into a success. Banks will also give you someone to help you through the world of business which can prove vital to your success or failure.