First and Foremost there are 5 million tips and not just 5 -:)
How you want to see it and finding a way out is absolutely upto you.
Related Article: 7.5 Tips To Create An Awesome Business Plan
I run one of the largest community of Startups & Entrepreneurs on LinkedIn called Startup Specialists Network and did put this critical question up for grabs sometime back. To my surprise there were such amazing answers to this critical question which I never thought even existed or for many they had never thought of.
Here are some of the tips that an aspiring entrepreneur could find it useful:
- Raise Funds Internally : This would ideally mean that call upon your trusted close friends and in fact family members and try pitching them the idea or the proof of concept in a simple way. The key is ‘ it has to be explained and pitched in a simple fashion’. If they can get excited and are willing to pool in some money nothing like it. Bootstrap first and try internal crowd-funding.
- Build a Factual Business Plan : This would mean not building a copy all template from internet but a blue print document of how, what, where, when, why you would function with the business in mind. This is your baby so make sure you get all the concrete details in place.Cover all the aspects of the business and how would you run it on a daily or weekly or monthly basis with factual projections on costs and revenues. Any investor would want to know this in totality.
- Have a Smart Kickass Founding Team: Not many people would agree to this but I have seen and been part of such associations where people have invested into people and the business plan. Select and get the right human capital with expertise in the domain areas of your business so that you can project them as the Spartans who will run and expand the business for you. For the investor it is logical that he or she is handing over the money to a set of people who are leading the expansion and de-risking the model
- Create a Lucrative Market Fit: This would mean to get the MVP or the POC out in the market fast and test it with the prospective clients. Most of times investors get interested (sometimes even the clients 🙂 ) to get the piece of your business pie. It is important that you don’t waste so much time waiting for investors that someone launches the product faster than you. Bootstrap, Crowd-fund or Get some Debt/Equity in place but get the product out. Sometime you may even get surprised that with coming revenues you may not even need investors and can be self sustained.
- Say NO to Vulture Capitalists: Your business idea is not for sale and nor is your company. Giving a huge portion of equity for some pennies is not a fair idea. Keep the expectations of the investors in check and feel free to refuse if the asking of the investors crosses your needs or you would have to give away your company completely with no controls at all. Be fair and ask for fairness. This situation goes down vastly when you have the revenues coming in or have the POC or MVP in place.This is the time you can negotiate well.
One critical thing is of-course you should have a solid panel of advisory board or mentors to guide you during this process or further. This just doesn’t mean you hire some dummy off the hook experts who wouldn’t be able to add value to your venture.They would people who would help you those opportunities that could help you in raising funds at various pitstops of your venture.