Financing Your New Business
Financing Your New Business
Some pointers for first time business owners starting a business
By N. Michael Miller, renowned Venture Capitalist
The past year and half has been tough. Tough on all of us; business owners and consumers alike. But things are improving. Even the outlook for the very near future is very promising. In support of that statement, look at what the experts are saying about 2010 at the end of this article.
Throughout the past year, people have contacted me about starting a new business. Never before have I seen such a variety of entrepreneurs. There is the typical business venture type of people that I see every year; good business people with good ideas. But more and more I am seeing a new type of businessman.
The brand new entrepreneur that last year couldn’t even spell the word. These people have a new, urgent reason for starting their own business; they don’t want to be at the mercy of an employer anymore. They want to make their own way, determine their own income and set the course for their own future. To these people I say HURRAY.
I have been renewed in their enthusiasm and fresh ideas. So if you are thinking of taking the plunge into the business world for the first time, here are some quick pointers.
First, have an idea of what, how, when and where (the who comes later). Be able to discuss with anyone you meet what it is that you want to do, how do you intend to do it, when is this going to occur and where are you going to be located. Don’t paint this picture with board strokes. You need to have this thought through in amazing detail.
Second, develop your plan. I am a firm believer in planning. Detailed planning increases your chances of success a hundred fold. Good planning avoids the two things that I have seen doom a new business to failure, wasting money and not foreseeing problems/obstacles.
New business owners typically go into business under funded. No planning or bad planning always results in spending money where you don’t need to be spending and then results in not having the money you have to spend on things to be successful.
Problems or obstacles must not just be solved in a new business, they must be avoided. Problems take time and money to solve. Obstacles can change the whole course of the business. Planning can foresee these events now, before the risk is undertaken.
Third, involve the professionals at the beginning. You will need to allow capital money for an attorney, an accountant and maybe a business consultant or two.
You either pay attorneys on the front end or the back end. It always cost less on the front end. Use an attorney to get the business structure set up correctly from the beginning.
You are going to need to set up good accounting in the beginning. Where the money goes and what the money goes for must be a daily accounting. This is very important.
You might need a business plan written for investors or you might need an experienced business person to mentor you. If you seeking investment funds, the investor will want to know that a professional business person is involved in your business. As far as planning goes, having a business plan is vital. Believe me, any bank, investor or venture capital source will be considering these very issues and their main question will be “How are you going to spend the money”.
Fourth, keep an open mind. If you are just starting out, your idea will evolve. If you have been planning your new business for a while, it has already evolved from what you first thought that you would want to do. Talk to people, listen and read. Get input from everyone you can about their opinions about what you want to do. Don’t just ask their opinion; listen to what they tell you. Analyze it, internalize it. Look for pitfalls and shortcomings in your own ideas. The most successful people that I have worked with over the years have been the ones that listened to others and were not afraid to change the course of their plans and ideas. Keep growing and evolving.
As I said in the beginning, these are quick pointers. This means that these are not all of the pointers that I would give new business people. There are actually hundreds of them. Just start with these and move on getting your new business started. Good luck and have the courage and strength to succeed!
As promised, here are some of the expert predictions.
April 9, 2008 – US Economy Will Stumble Along Until 2010, IMF Says. (From the
In its latest economic forecast, the IMF said the world's largest economy won't be hitting on all cylinders until 2010. "In the
March 25, 2009 – No Relief for Economy until 2010? (Reported on CNNMoney and currently posted online arkansasmatters.com)
But in 2010, the report predicts an average quarterly growth of 2.7-percent and an average of 4.1-percent in 2011.
July 8, 2009 - IMF Upgrades Outlook for Economy (By Reuters and currently posed online at nytimes.com)
It now sees world economic growth of 2.5 percent in 2010, however, compared with an April projection of 1.9 percent.
“Financial conditions have improved more than expected, owing mainly to public intervention, and recent data suggest that the rate of decline in economic activity is moderating, although to varying degrees among regions,” the monetary fund said.
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Call today toll free 1-877-211-6577.