Put Consulting Experts Before the Money
Think you’re ready to start raising money for your new business? Think again. Many small business owners fund their businesses with the help of equity partners in the early launching days. Other options are to finance with venture capital, equity crowdfunding, or even investments from friends and family. Regardless of which route you take, be sure to first talk to the following small business consultants.
Attorney. An attorney is often the first person you consult before raising money to finance your small business. Finding the right attorney will depend on how you choose to finance your business in those early days. You can find an attorney that specializes in the type of financing you’re pursuing.
Banker. Which financing option you’re seeking will determine the appropriate banking partner to consult. If you’re planning to reach out to private investors, you most likely will only need to consult with a local bank to confirm you’re in good standing, according to Inc. However, if you’re raising money through a venture capital transaction or equity crowdfunding, you should contact a qualified retail or investment banker with expertise in your type of financing.
Marketing consultant. Consulting a marketing expert can increase your chances of attracting the financiers you’re seeking. “Marketers help me brand and promote my company including polishing my investor pitch and elevator speech,” says Bobby Montagne, co-founder of Walnut Street Finance, a real estate lending business.
But marketers can do more than help with nailing down your basic pitch. They can help you craft a long-term fundraising marketing strategy, which will convince interested parties that you’re worth the investment.
Seeking out consultants to cover your legal, banking, and marketing needs is absolutely essential before you start fundraising. But it doesn’t have to stop there. “In the funding stage – which never really stops – you must know your business, including the numbers, the market, the competition and industry and consult with anyone and everyone who can help you better understand your industry and niche within it,” says Montagne. “Reading, attending conferences, studying your competition – really knowing your space is vital. Investors have a sixth sense for ferreting out the truth and if they sense you are not the real deal, they will promptly pass on your offering.”
Source: National Federation of Independent Business
Copyright 2020 The Business Journal, Youngstown, Ohio.