I’ve been approached by a few people looking for funding to grow their business.
There is a popular saying that there are 3 sources of funding – friends, family and fools! But I believe there are no foolish people around looking to throw their money at failing ventures. So, you have to be ready to convince savvy investors or professionals (bankers) to part with their cash.
To do this, I believe there are 3 areas you need to demonstrate strong performance on:
1. Your business needs to be commercially viable.
It should ideally be turning a profit unless you are in the tech industry or Silicon Valley or its equivalent. You need to have a nice profit margin on your activities for your business to be of interest to a third party.
2. You should have a strong team in place.
Your team should have the credentials (we are not talking academics) to prove to an investor or bank that they are able to deliver on the vision that they are investing in.
3. You should have the potential to be scale up the business whilst remaining profitable.
Is the business scalable? And if so what model do you have in place to facilitate that?
Do you have any thoughts on this subject? Please comment below.