Every day I receive private messages on Facebook, emails or direct messages, on Instagram from my friends asking me to lend them money and I'm not kidding, things like can you lend me $5,000? Can you give me a loan of $10,000? They say they'll pay it back because they need the money to start a business. Sometimes it feels like they're just looking for a handout.
But here's the thing; Just because someone is successful doesn't mean they're obligated to help you if you haven't even tried helping yourself. By reading these requests I can tell where you're at. First of all approaching individuals with nothing but requests isn't the way to go. You should approach them by offering value and giving something in return before asking for anything. Secondly, if you have no money and want to succeed in horse racing (as an analogy) it's, like being a jockey or entrepreneur. Your business idea or concept probably lacks substance too.
If I had to choose a horse to bet on why should I pick you when I have experienced jockeys with track records and exceptional horses approaching me all the time? Honestly I don't even know you very well. Why would I invest my money in your business? So it's your responsibility. Let me share four strategies with you on how you can secure funding, for your business.
1. Sharks
If you're looking for funding the first group of individuals you should approach are what I like to call "sharks." These sharks refer to the venture capitalists and professional investors you often see on shows, like Shark Tank. Years ago they were entrepreneurs like us. Now they have amassed wealth. Are actively seeking wise investments and experienced entrepreneurs to support. The reason they are referred to as sharks is that they aim to maximize their returns by investing in proven opportunities rather than unrealistic ideas. This explains why you often hear contestants, on these shows being told that passion alone is not enough; they need a strategy and business expertise to succeed. The absence of any capital implies the necessity, for an investment in order to foster business growth. This aspect holds implications. Conveys a considerable amount of information to others. When engaging with investors or sharks it is crucial to recognize that there might be an opportunity to secure funding, from them. However it is essential to be aware that convincing them will likely require relinquishing a portion of your company's ownership. Because they are taking a risk on you. Typically these investors have an amount of business expertise. They might request a stake, in your company. So when it comes to dealing with these investors it's, like swimming with sharks.
2. It's what I call "Dolphins"
So the dolphins well they represent institutions, like banks and credit unions. These are places where you can borrow money. Speaking of banks let me tell you about my experience years ago when I was trying to get a $2,000 line of credit. Can you believe it? They refused to give it to me! Now my bank keeps calling me all the time offering loans and mortgages. They even suggest getting lines of credit or additional credit cards for my needs. I keep telling them that I don't need any money now but they insist on giving me a call just in case. Banks usually operate by lending money when you don't really need it; that's how they work, Dolphins loan you money when it is not necessary. Unfortunately they aren't as willing to lend when things go south.
They refrain from doing so because again bankers and dolphins tend to be quite cautious and risk averse. Well let me tell you something, about dolphins. Now even though you might think dolphins are creatures and have a nice demeanor don't let that deceive you alright? Dolphins are also capable of biting your head off. Their teeth are just as sharp, as those of a shark. So don't assume that dealing with dolphins is all rainbows and sunshine. In reality they operate as a lending business. Make their profit from the interest on the money they lend you. They have an investment to protect like any business. So it's important to consider the time and place for involving dolphins in your matters. And chances are, if you're just starting out and don't have an established track record or experience in running businesses it will be quite challenging for you to secure a loan, from Dolphins.
3. Is what I call "Fish"
Fish represents your loved ones, including family and friends. These individuals, such, as your parents, siblings and extended relatives often end up being the ones who trust you enough to lend you money. They may not assess the situation critically. Believe in your character and work ethic. Despite knowing there is a chance you might not succeed and their investment could be lost they are willing to take that risk due to the relationship they share with you. I have personally experienced this when I borrowed money from my uncle to start my business but unfortunately couldn't repay him. So based on my career experience I strongly believe that the best way to secure funds for your business is, by obtaining it from your customers themselves. How do you achieve that? By going and effectively selling your products or services.
You can increase your sales by taking an approach. Of asking me for a sum of money and relying solely on luck show me what you can bring to the table. Offer your services, skills and expertise to demonstrate your ability to generate profits.
4. Go to your customers.
Let us consider a scenario where you're a marketer looking to start your digital marketing business specifically focusing on assisting clients with graphic design. The good news is that you don't require an amount of capital or the need to borrow sums of money, print elaborate business cards or invest in extravagant resources. Instead the key lies in selling something. By securing your client you'll be able to generate the funds for your venture. Now some might express concerns, about their ability to sell effectively. However it's important to recognize that lack of experience in sales is often tied to limitations. If you currently find yourself lacking the funds and struggling with making sales it wouldn't make sense to assume that simply having money would automatically equip you with better sales skills. It's akin to not knowing how to swim in a pool but believing you can effortlessly navigate swimming, in a lake or an ocean; it just wouldn't work out well for anyone involved. Then attempting complex techniques right away focus on mastering the basics like kicking and floating comfortably in a pool before progressing further.
Wow, Jesus Christ! I totally agree with you. You know what? There are actually ways to earn money from your customers as well. For instance one effective approach is to request payment, in advance even before you start working on the product or service. It's, like having a Kickstarter campaign, where you come up with an idea and pitch it to the market to see if people are interested. You can have your customers fund your business, which is great because they have an interest in its success. Another option is a subscription model, where customers pay on a regular basis. I really like that approach along with paid events, Kickstarter and other ways to secure funding from your customers. It's important to get that support and prove your business model.
Once you have successfully proven your model you can approach investors or partners, whether they're experienced entrepreneurs (dolphins) or well established businesses (fish) and showcase what you've achieved so far. You can confidently say that you've taken it far, as possible on your own and now want to scale up. When presenting your ideas to these investors or partners (sharks) they are more likely to listen and acknowledge the potential of what you have accomplished.
You've already achieved revenue, which is impressive. It's great to see that you're generating income before launching your product or taking any actions. Moreover having recurring income demonstrates a business model. This entrepreneur seems promising and definitely worth considering as an investment opportunity. That's the kind of confidence I'm talking about!
Conclusion
It's never, about money. Those who don't really need it are the ones who seem to receive it. It's not a lack of money that holds you back. Your own ability to attract and multiply it. Let me emphasize more the issue isn't simply a lack of funds. There is an abundance of money there. Banks and investors are practically swimming in cash. They're eager to invest because keeping money in the bank actually costs them. They're actively seeking opportunities and promising entrepreneurs. Unfortunately those are few and far between. When you approach them with the mindset and skills they'll readily fund your ventures. Your customers can also play a role in funding your endeavors, it just makes sense, doesn't it? So don't tell me you can't expand or start a business due to lack of funds; rather consider if it's your approach as an entrepreneur that needs improvement, some food, for thought.
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