Thinking of a start-up?
Time was, a two minute elevator speech to the right investment banker or venture capitalist got a financial fire lit under your brilliant idea. Seminars were devoted to the art of pitching short-form visions to short-term visionaries. That was then: Money flowed, risks were riskier. VCs were easy, full of heady exuberance. Markets were flush with cash and. . . well. . . more cash. Ideas were funded too far ahead of execution, and it was okay that a lot of idea-mongers fell flat on their faces, got executed. The market forgave failure. There was always another Google or Cisco around the corner. Investors jumped in and out fast. Ideas were king.
Falling on one's face was, after all, to be expected when aggressively innovating. But that was then. These days, expectations are a tad more demanding, at least from the investment houses that are still in business.
Don't get the wrong idea: There's still plenty of money. It's just that investors have matured beyond dating start-ups. Now they want to marry them. Flash and sizzle no longer count. Results and a track record do. Proven execution means reliability and shelter in the storm, and it is stormy out there. Investment will follow a solid opportunity, but it's up to you to start your own enterprise, because in this economic environment, investors won't.
So, after you've begged, borrowed and stolen enough to get your company going, to get your horse out of the gate, where do you go from there?
Foresight is key: To get the investment pump primed, at a bare minimum you need a 'tent stake' business plan - and a solid one, not some pie-in-the-sky fluff - that holds up under critical eyes, along with proof that you've worked your plan in some capacity. After that, getting customers, a couple quick wins, growing interest, market buzz, all leading to your well-executed strategic response to the market is what keeps the money flowing. Today's investments are staged. If you can't communicate a credible plan for growth, you won't grow - simple.
Credibility also hinges on long-term planning for expansion. Investors expect growth, right? What is your plan to evolve the backbone of your business? - Financial, Quality, CRM, Marketing, Distribution, Production systems? How are these functions accommodated when you're small? Five years from now? What milestones cause you to add people/cost? What market conditions fund those milestones? Where are plateaus in your opportunity from which to launch vertical markets, international expansion? Investors have matured, how will you?
Having a great idea is just the start. Companies like Thomas Financial Services, LLC, www.thomasfinancialsvcs.com step in where you can't, partnering with you to build competencies, tune you up for investment, plan your success, tell your story. Likewise, such experienced companies, knowing what investors are looking for, often act as third-party scouts, digging deep, offering quick-turnaround, neutral analysis of investment targets in over sixty categories.
Great concepts fall flat in the hands of losers. Weak concepts usually thrive with a winning team. Proving you're capable of sustained, incremental, planned success is your single greatest keystone to credibility. Growth has slowed today. Investment is tough. Make investors believe in you. Getting help by partnering with a winner in harsh economic conditions may be the best investment you make.
Time was, a two minute elevator speech to the right investment banker or venture capitalist got a financial fire lit under your brilliant idea. Seminars were devoted to the art of pitching short-form visions to short-term visionaries. That was then: Money flowed, risks were riskier. VCs were easy, full of heady exuberance. Markets were flush with cash and. . . well. . . more cash. Ideas were funded too far ahead of execution, and it was okay that a lot of idea-mongers fell flat on their faces, got executed. The market forgave failure. There was always another Google or Cisco around the corner. Investors jumped in and out fast. Ideas were king.
Falling on one's face was, after all, to be expected when aggressively innovating. But that was then. These days, expectations are a tad more demanding, at least from the investment houses that are still in business.
Don't get the wrong idea: There's still plenty of money. It's just that investors have matured beyond dating start-ups. Now they want to marry them. Flash and sizzle no longer count. Results and a track record do. Proven execution means reliability and shelter in the storm, and it is stormy out there. Investment will follow a solid opportunity, but it's up to you to start your own enterprise, because in this economic environment, investors won't.
So, after you've begged, borrowed and stolen enough to get your company going, to get your horse out of the gate, where do you go from there?
Foresight is key: To get the investment pump primed, at a bare minimum you need a 'tent stake' business plan - and a solid one, not some pie-in-the-sky fluff - that holds up under critical eyes, along with proof that you've worked your plan in some capacity. After that, getting customers, a couple quick wins, growing interest, market buzz, all leading to your well-executed strategic response to the market is what keeps the money flowing. Today's investments are staged. If you can't communicate a credible plan for growth, you won't grow - simple.
Credibility also hinges on long-term planning for expansion. Investors expect growth, right? What is your plan to evolve the backbone of your business? - Financial, Quality, CRM, Marketing, Distribution, Production systems? How are these functions accommodated when you're small? Five years from now? What milestones cause you to add people/cost? What market conditions fund those milestones? Where are plateaus in your opportunity from which to launch vertical markets, international expansion? Investors have matured, how will you?
Having a great idea is just the start. Companies like Thomas Financial Services, LLC, www.thomasfinancialsvcs.com step in where you can't, partnering with you to build competencies, tune you up for investment, plan your success, tell your story. Likewise, such experienced companies, knowing what investors are looking for, often act as third-party scouts, digging deep, offering quick-turnaround, neutral analysis of investment targets in over sixty categories.
Great concepts fall flat in the hands of losers. Weak concepts usually thrive with a winning team. Proving you're capable of sustained, incremental, planned success is your single greatest keystone to credibility. Growth has slowed today. Investment is tough. Make investors believe in you. Getting help by partnering with a winner in harsh economic conditions may be the best investment you make.
About the Author:
Thomas Financial Services LLC, Small Business Consulting helps small business connect with investors. In addition TFS provides rapid turn-around assessment operational competencies in any company targeted for an investment round. Thomas Mezger, CEO, tmezger@thomasfinancialsvcs.com and John Sawinski, SVP, jsawinski@thomasfinancialsvcs.com bring over sixty years of street-level leadership experience to accelerate your growth
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