As an Angel investor to startups, I'm still surprised to find entrepreneurs who expect investors to give them money, and then disappear into the sunset. Would you do that if it was your money?
Finding loans to start a business can be time consuming and costly if you are not careful. While it does not usually actually cost anything to apply for a loan moneywise, it does cost time, and time is money.
Recently, the St. Louis Business Journal described 2013 as the year "St. Louis tech took the money and ran," profiling just how much money our city's tech startups raised last year. The number is pretty impressive: $56M+ from just our top five startups.
I'm seeing more and more marketing showing up about so-called crowd funding these days. Sorry, but no. Not yet. Reports of crowdfunding in the U.S. are, as of today, just wishful thinking.
Even when your startup is a one-man show and lots of fun, a "business" needs some discipline and controls to keep it from being defined as a hobby by investors, and assure some financial return.
While it's true that most new companies require some degree of startup capital to help get them off the ground, many businesses are surprisingly cheap to open. There are several ways to keep initial costs low when starting a business.
There are some grants available even for one person shops, from cities, corporations and even non-profits for just your type of business, especially if you support a social cause, can employ more people, or help turn around a geographic area in need of upgrade.
Let me tell you the story of how I raised $100,000 to fill a gap needed to purchase a new home for my young family years ago. I had located a beautiful home that would be a stretch to finance, and had arranged for a first mortgage from the bank, and a second from the seller.
Can you imagine having 300 shareholders? With recent legislation and new portals on the Web, it's entirely possible, perhaps for the first time for small businesses.
Friends and family will likely not expect the same level of sophistication on the business model and financials as a professional investor, but they do expect to see certain things. Here is a summary of some key items to think about as an entrepreneur before approaching friends, family, or even fools.