It seems as though your stage has been set. The ducks are in a row, your idea is solid, but how can you really take off without that big chunk of change to set the gears in motion?
Well easy does it partner!
The first step to reaching out for the financial backing is to take a step back. Money isn’t actually the root your business should grow with. Know your product from the actual baselines. Try to even get a few customers before the big bang, and therefore you can receive a small taste of how desperately this market really wanted your product.
By having to small scale produce your work, you can gain a better understanding of what you can maintain on a small scale, and where the funds will be best directed without over spending unnecessarily.
Without this basic understanding of your own Startup, you may find yourself straying away from your goal by approaching investors too early. A great pitch may land you some funding, but faced with a difficult market, or investors that see a different path for your Startup can cause problems.
A firm foundation will have investors following your idea, rather than you following their money.So stay small and efficient on as little money as you can to prove to yourself and your future investors that what you have can and will work. You want to knock out the little problems early and on a small scale to keep them affordable.
Well now you have what you think you need. You are confident in what you have put together so far, and believe you really know how to make everything work. You’ve tried and failed and worked out the kinks. What should you look into now?
STEP ONE: DO YOU HAVE A HUNGRY MARKET?
The market you are after shouldn’t be set on the backburner until you have a fully functional corporation. Let loose on your market early. Let them try your product, and soak up their feedback as much as possible. In reality, your investors need them more than they need you, so learn your consumers as much as possible to know you are in the right direction with the right amount of consumers.
STEP TWO: MASTER YOUR CRAFT FULLY
That investor wants to see you at top form. A fully polished product and business model with the ability to adjust. However, do not mistake an open minded policy for change in your business model as not actually having a strong plan. Know your business and its ins and outs. Be the guide for the investors to see how you can accomplish what is necessary rather than putting it together after you’ve presented your idea.
STEP THREE: DO NOT SELL YOURSELF SHORT
These initial investors might not be funding you for the long haul, and you should be ready for this. Make sure you know your goals throughout the first couple of years, and keep in mind what will be the point when you need to strike out again for the next financial boost.
STEP FOUR: ARE YOU OPEN TO ADVICE
Having a creative mind that started this idea is a great thing. This doesn’t mean over sell yourself in areas that you may not be the expert in. Try to let your investors help guide you, a different stance and view on direction for your startup may be just what you need.
Let these ideas be a founding point on deciding on whether or not you are truly ready for the financial step. If not, never fear, for you have made it this far so keep doing what you are doing and stay true to your goals. Time for investors will come, so right now, learn the business that you are in, and then worry about how to get funding for a startup business.