Read Online Never Get a ”Real„ Job by Scott Gerber - Free Book Online
Authors: Scott Gerber
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it’s not a real option. Get it out of your head!
Entrepreneurship is a beginner’s sport, not a banker’s sport . Building a business is more about ingenuity and hustle than obtaining a wad of cash—which is why young people are the ideal candidates to build businesses. Compared to older generations, we have minimal living expenses and have the ability to scale down our lifestyles dramatically without major consequences. We also have the ability to bounce back after rock bottom far easier. And our belief that we can do anything drives us to solve problems.
Six Fund-Raising Pillars to Attract Investors
Without a successful business under your belt, investment dollars won’t be coming your way anytime soon. Don’t even try to raise capital until your business has a handle on all six of these fundraising pillars. Otherwise, real investors and lenders won’t even give you the time of day:
1. History . Inspire confidence with facts, not fiction. Companies built from the ground up have a huge advantage over those seeking start-up capital because they have proven they are real businesses with real customers and real revenues. Your company must have cash flow, a track record, and real-world experience before any credible investor will listen to what you have to say.
2. Equity . The only thing investors and lenders care about more than making money is getting their money back. And the only way to do that is to base their investments on something with real value that they can sell off if times get rough. Banks may ask for personal guarantees supported by a home and investors might tie their money to a company’s patent. Either way, know that investors care about their money before your property.
3. Leadership . Money people invest in operations people, not businesses. Your leadership abilities must inspire investors. They have to believe that their investments are in capable hands and that you can effectively execute a strategy.
4. Stewardship . Your company must be debt-free, or close to it. Red balance sheets are nonstarters for most investors. No one wants to be responsible for paying off someone else’s mistakes or debt.
5. No Liability . Your business must be clear of any pending or active litigations or lawsuits and free from personal or business debts that could endanger the company—or more importantly—the investor’s money. If you can’t pass a background or credit check, you won’t be getting a check—period. But don’t lie. Lies and partial truths will end up hurting your company and your relationships with investors in the future.
6. Direction . Get investors excited about the big picture, but be reasonable and responsible. Avoid hockey stick projections. Respectable investors will not take you seriously if you present them with nonsensical financial graphs that claim your company’s revenues will grow from $100,000 to $50 million in three years—if only they would invest. Show investors that you have a grasp on reality by clearly outlining how you plan to use their funds.
Remember, getting outside financing still doesn’t offer any guarantee of success—all it guarantees you is more mouths to feed before you can feed yourself and more cooks in your kitchen. It also means trading in many of the freedoms you worked so hard to achieve—and could even mean giving up the controlling stake in your business.
If you take on any investor—and that’s a big if—be sure to do your due diligence. Don’t just take money for the sake of taking money. Know what else your investors have invested in, what they specialize in, their track records, how deep their pockets are and what they bring to the table besides cash. Make decisions based on what’s best for your business, not the investor.
The best businesses are built with blood, sweat, and tears, not funding . Your personal energies are far more important and valuable than any investment dollars
Entrepreneurship is a beginner’s sport, not a banker’s sport . Building a business is more about ingenuity and hustle than obtaining a wad of cash—which is why young people are the ideal candidates to build businesses. Compared to older generations, we have minimal living expenses and have the ability to scale down our lifestyles dramatically without major consequences. We also have the ability to bounce back after rock bottom far easier. And our belief that we can do anything drives us to solve problems.
Six Fund-Raising Pillars to Attract Investors
Without a successful business under your belt, investment dollars won’t be coming your way anytime soon. Don’t even try to raise capital until your business has a handle on all six of these fundraising pillars. Otherwise, real investors and lenders won’t even give you the time of day:
1. History . Inspire confidence with facts, not fiction. Companies built from the ground up have a huge advantage over those seeking start-up capital because they have proven they are real businesses with real customers and real revenues. Your company must have cash flow, a track record, and real-world experience before any credible investor will listen to what you have to say.
2. Equity . The only thing investors and lenders care about more than making money is getting their money back. And the only way to do that is to base their investments on something with real value that they can sell off if times get rough. Banks may ask for personal guarantees supported by a home and investors might tie their money to a company’s patent. Either way, know that investors care about their money before your property.
3. Leadership . Money people invest in operations people, not businesses. Your leadership abilities must inspire investors. They have to believe that their investments are in capable hands and that you can effectively execute a strategy.
4. Stewardship . Your company must be debt-free, or close to it. Red balance sheets are nonstarters for most investors. No one wants to be responsible for paying off someone else’s mistakes or debt.
5. No Liability . Your business must be clear of any pending or active litigations or lawsuits and free from personal or business debts that could endanger the company—or more importantly—the investor’s money. If you can’t pass a background or credit check, you won’t be getting a check—period. But don’t lie. Lies and partial truths will end up hurting your company and your relationships with investors in the future.
6. Direction . Get investors excited about the big picture, but be reasonable and responsible. Avoid hockey stick projections. Respectable investors will not take you seriously if you present them with nonsensical financial graphs that claim your company’s revenues will grow from $100,000 to $50 million in three years—if only they would invest. Show investors that you have a grasp on reality by clearly outlining how you plan to use their funds.
Remember, getting outside financing still doesn’t offer any guarantee of success—all it guarantees you is more mouths to feed before you can feed yourself and more cooks in your kitchen. It also means trading in many of the freedoms you worked so hard to achieve—and could even mean giving up the controlling stake in your business.
If you take on any investor—and that’s a big if—be sure to do your due diligence. Don’t just take money for the sake of taking money. Know what else your investors have invested in, what they specialize in, their track records, how deep their pockets are and what they bring to the table besides cash. Make decisions based on what’s best for your business, not the investor.
The best businesses are built with blood, sweat, and tears, not funding . Your personal energies are far more important and valuable than any investment dollars
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