Hats off to our entrepreneurs! Your efforts make America and the world work.
“In 2014, independent businesses created nearly 2 million of the ~3 million private-sector jobs generated, or 2 out of 3 employment opportunities.”
—BALLE (Business Alliance for Local Living Economies)
But, how do you get the money you need to do your idea? We recognize that raising funds – asking for money – is difficult! For some, it is the hardest part of getting their idea going. Here are some tips for easing the pain, lessening the mistakes, and keeping you going as you press onward.
DO
1. CREATE A TARGET LIST. Start with people you know. Yes, including your family. 100% family participation is a real boost. Don’t forget that rich uncle or that 2nd cousin twice removed who married into the family. It is a great chance to discover and share.
2. BUILD A NETWORK. Go deep in a specific community. Become the buzz. There is always a chain of intros. Ask for it. Gather advisors around you and experts who can help you be successful.
3. TELL PEOPLE WHAT YOU’RE DOING. Have regular, interesting and fun communication and education. Consider niche social networks to be in; find communities geared to your specific market.
4. LISTEN AND ASK QUESTIONS. Listen as much as you talk, maybe more. Have good questions to ask people. Be respectful of people’s time and resources. Ask advice, rather than money.
5. BE PASSIONATE, BUT PRACTICAL. Have a short pitch and make it really interesting! Sell yourself and your passion, but do it succinctly and back it up with real data and good looking visuals.
6. ASK MORE THAN ONCE. Don’t take NO personally. Everyone is busy, politely ask people again if you haven’t heard back. Communicate directly. Sending an email is not communicating. If you get turned down, ask for advice and ask why. Go back, after you’ve taken their advice and rectified your weaknesses.
DON’T
1. OVERREACH. Too often people ask us to “introduce us to the investors you know.” It doesn’t work that. You have to do the work. You have to be impressive and be something people want to know about. We can only help.
2. TALK TOO MUCH. Don’t launch into a long monologue about your interesting idea. Take it slow. Listen. Let them ask questions and guide the conversation.
3. WASTE PEOPLE’S TIME. First contact could be as short as 20 min, no longer than 1 hour. Fit your communication to their expectations and time. Take their lead and respond in kind.
4. MAKE EXCUSES. These are common ones to avoid:
—My friends and family don’t have money. Maybe they know someone, a second uncle, a brother-in-law…
—My friends don’t understand this business. Educate them. Share your passion and the opportunity.
—My family is complicated. All families are complicated. Use this as an opportunity. Our immigrant ancestors had to finance their efforts among each other, banks didn’t help them.
—The people I know don’t invest in this stuff. How do you know for sure? Really doesn’t matter; you’re asking them to invest in YOU.
Thanks for your good ideas. Now, on to your next steps.
Coming next… exercises and tools to get over the hurdles.
by Drew Tulchin and Sheila Seclearr
