If you are fully committed to getting funded, you will make the sacrifices necessary to prepare properly so investors will take you seriously. Your commitment level is therefore a fundamental issue that you determine for yourself, as early as possible, in order to prevent wasted time, effort, and money.
As you analyze your level of commitment, you may (a) need to adjust your expectations, and then press forward with realistic plans and determination; (b) decide that it makes sense to abandon your project and move on to something else; or (c) recognize that the project is simply a hobby you enjoy that is not worth trying to raise capital for as a business. All of these are valid conclusions that can lead you to differing courses of appropriate action.
Self Test
What will it take for me to secure the needed funding?
- Meet a rich person who tells me I have a great idea.
- Read a lot about raising capital, and work hard to understand the entire process.
- Write a business plan.
- Consistently do the right things in the right way until I finally succeed.
How much of my own money am I willing to invest in the business?
- Other people should take all the financial risk for my visionary ideas and insightful leadership.
- I don’t have much to invest, but I should be able to get some seed money from family and friends to get started.
- I could probably invest what is needed, but I’d prefer to share the risks and rewards by using other people’s money as well.
- I have already invested a great deal, and now need the resources of other people to take the business to the next level
How much time and effort am I willing and able to expend in the process of getting funded?
- I want someone else to do it all for me.
- I can spend an hour or two each evening.
- I’ll do whatever I can, because this is my primary focus.
- I will make time as needed and use the expertise of others to help me.
What kind of support network have I established to help me get funded?
- I met a guy who raised millions for another company, and he says he can do the same for me, no problem.
- I’m not sure what kind of support network I may need to get funded.
- I actively network in my local Chamber of Commerce, but this is not providing the kind of connections I really need.
- I know many potential investors who are willing to review my opportunity as soon as I have something professional to show them
Where am I in terms of the capital raising process?
- I’m out of money, need it by 5:00 p.m. today, or they will repossess my ’86 Mercedes.
- I’ll need capital within the next 3-6 months, and I’m now preparing for the financing process.
- I recently engaged finders to help me connect with investors.
- I’ve nearly exhausted my contact network and investor approaches, and I need expert assistance.
What happens if my business doesn’t get funded?
- That’s O.K., I’ll just keep my day job.
- I’m not sure; I am still working through the numbers.
- My business won’t be able to expand as fast as I’d like.
- My business will struggle, but it will survive.
Evaluating Your Commitment
Your answers won’t indicate a clinically precise commitment, but they will generally correspond with the following commitment levels:
- Weak commitment and unrealistic expectations. Don’t waste your time or money. You’ve got a hobby (and won’t get funded), or you are likely to waste lots of resources (and not get funded).
- Early stage development and tentative commitment. A preliminary expert analysis of your business, coupled with the creation and distribution of several key presentation materials, can provide a realistic indication of your potential success in raising funds. If your initial efforts yield positive results, you can proceed with full capital raising preparations.
- Attitudes and actions indicate a growing commitment. An expert review of your presentation materials and methods can provide valuable insights that significantly improve your chances for success. Specific changes and additions will result.
- Conditions and actions indicate a strong commitment to get the job done. Overhauling your materials and approach will probably be required. Don’t expect more of the “same old, same old” to yield different results. Get expert help to get the job done right.
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