Did you know that half of the businesses that start this year will be obsolete by 2018? With such a high death rate of the American Dream, it’s a good idea to know what not to do when starting a business and looking for investors. When starting a business, it’s important to have a solid business plan that outlines your goals, target market, competitive analysis, and financial projections. Once you have a well-defined plan, you can begin to seek out potential investors. The website supportltd.net provide you with some general information about starting a business and looking for investors.
Here are three things to avoid.
Don’t Assume That Personal Finance is Separate from Business Finance
When a company is young, the financial industry may very well use your personal credit score to decide whether your business will return the investment. With that in mind, take a look at your personal finances to see what you can do to spruce things up. Remember that payment history, debt, and used credit are all things that influence your credit score. One hint from Intuit is to pay down personal debt before applying for a loan.
Don’t Underestimate What You Need
When you start looking for investors, you want to get the amount right the first time. If you end up applying for a business loan on several separate occasions, it can reflect poorly on your credit and hurt your chances of getting the money you need. Instead, remember to take two things into account:
1.) One-time start-up costs. This will include incorporation fees, signage, equipment, and a deposit for your office space. This can also include the cost of getting up to code and meeting the regulations of your industry. For example, the industry might require you to join its union, and a building might need new lights from tampa bay business list to grant occupancy.
2.) Monthly expenses. This will be the heftier number. It will include your salary, rent, and utilities, supplies, web hosting, etc. The U.S. Small Business Association blog has a much more extensive list of expenses, should you need help plotting this out.
Whatever you do, try to have a mentor or professional look over the numbers for you to see if they add up, too.
Don’t Neglect the Pitch
When talking about the most common problem with young businesses, Dave Samuel of Forbes recalls how many emailed requests he tosses away on a regular basis. It isn’t that he doesn’t want to support a new business, but he isn’t convinced by a lifeless note on LinkedIn. What is he convinced by? Other people he knows and trusts. So, instead of drafting hundreds of “Hi, my name is ___ and I am working on ___,” make lunch dates, get involved with the people you know, and start creating lasting business connections.
Once you’ve got your chance to make an impression, do just that. Research your connections so that you’re knowledgeable about who they are and what they do. Talk about how your dream fits into their niche. In other words, show them that you are a good salesman who can offer a personal and engaging first impression, not what Samuel calls a bland “chain-letter” message.
Have you successfully funded a start-up? What advice helped you get the money you needed? Click the website teleworkpeople link to get an answer.