In a previous post last month we talked about ideas .So let’s skip right to the assumption that you can stand before an investor and ask for money to facilitate an idea. Even if you took a whole 500 page detailed proposal with a gold cover it will never happen,they will definitely be interested in the gold but no one is going to finance your idea.But just to give you the benefit of the doubt maybe out of 100 you will get one person.
So here you are ready product created out of your spectacular idea in hand. Now you need funding to expand,grow or even support your business and after approaching a number of banks who have politely in very many words said no.You manage to get a venture capitalist or someone who is willing to invest in your idea .So you do mock interviews and watch 3 seasons of shark tank and this is what you actually realize:
Pitch preparedness for the innovator
So how do I put this?Ever heard that just because the idea comes from you it doesn’t mean you have the business skills to see it through.Meaning that you may need guidance into turning an idea into a business,
Well , it also applies in pitching.before you step into that room.Apart from your very brainy self get a professional to assist in breaking down everything for you in terms of presentation, valuations, et al.
You could also do a mock presentation the same way people do mock interviews.Get a friend or two and give them the pleasure (since they’ll definately enjoy making it difficult) to criticise your presentation.
In some cases you may even need someone to pitch for you. Its also advisable that when pitching carry with you one or two people, this is the person who will back up your idea, nod his head during your presentation and even smile assuringly and clap vigorously .Because at that moment you need all the encouragement you can get.
Get your valuations right
No matter how smart or friendly you are,wether your suit makes you look like you were born in it
Whether you have such intense passion you hold towards your work that it seeps out through each word that leaves your mouth. Dear friend not even your emotions will save you out of this question.
All that is needed is the numbers, how many sales have you made so far, what is your profit margin since you began, how much is your production budget. If you get the necessary by products locally what is the cost of the same in other countries. Who are the competitors in your industry and what sets them apart from you.
Just have your answers by the tips of your fingers.
So what do you need the money for?
First things first , If its for advertising then just spare the petrol and lock your self in the house enjoying your day. Advertising is expensive unless you’re thinking facebook and google ads.But what is just so disappointing about it is the fact that it doesn’t assure you of any money in return.
How many advertisements have you ever come across and yet you’ve never been lured to buy a single product from that. If you’re in search of money to initiate the idea then also forget about it. But if you need money to expand your business or increase production then you might just get lucky.
But if you reaaaally need to advertise your business here’s a tip.
Forget old school methods of marketing that require close to three million and use ehat you havr if you could afford a fancy launch with the who & who attending that could attract media attention then try it out.
Know when to invest in your business,when to sell it and when to let it go.
Knowing when to sacrifice one thing for another comes down to values and priotization and its different for everyone- Denise Thomas
Remember Yahoo’s story of rejecting Microsoft’s offer to buy out at 44billion in 2008 only to accept to buy out to Verizon at 4.8 billion in 2016.learn something from that.
Sometimes you also come up with this great idea and like any other business you expect that with time that it will bring back profits only for you to face losses, stagnation four years down the line. Yet sometimes you have put in four times more money than what you have gained back as profit .To be precise there are no positive results .
Listen to your intuition, let it go.