So you’ve got a million-dollar business idea? That’s great! But there’s still a whole lot of hard work to be done before your initial business concept will indeed start coming to life.
A lot of that hard work will be during the initial startup phase of your business, which is when many entrepreneurs struggle to find the funds they need to get their business off the ground.
Sure, conventional banks and lenders are great, but often, these institutions won’t even look at your business idea until you’ve been in business for some time.
So how else does an aspiring entrepreneur find the funding they need?
For those lucky enough, you might be able to approach family and friends in your life that can help you out. But bringing up the idea of borrowing a large sum of money isn’t always easy.
Therefore, we thought it’d be a good idea to put together the following quick guide on how to approach friends and family to help you fund your business.
Whether you’re asking your mom and dad, your great uncle Fred, or your best friend, it’s crucial that you do so honestly when you broach the subject. You’re genuinely asking somebody you know for their money. Therefore, you don’t want to seem like you’re being dishonest or sketchy about the matter at any cost.
Be ready to explain your business idea and why you think that it will succeed, and be prepared to defend it too if they start asking you questions.
For the most part, nobody you approach will be asking you questions to try and put your idea to shame, but rather to try and understand why they should be willing to lend you the money to begin with.
Be ready to show them any marketing materials, logos, or branding that you may already be working to help them get a better idea of your vision. Or, click the link to get started with designing your own business logo today. https://www.logocreator.io
Understand that just because somebody has the money you need doesn’t mean that they should give it to you. After all, it’s their money, not yours.
So make sure to be realistic about whom you ask, as well as your expectations. Not everybody will entertain the idea or even be interested in hearing about your business idea. And that’s ok.
It’s also helpful to avoid asking people if you already know they’ll most likely be against the idea. Don’t pester them! Just move on!
For instance, maybe you’ve got a rich aunt Suzanna who has always hated dogs. In this case, you might want to think twice about approaching her for funding to start your doggy daycare business.
The fact is that money can often put a strain on a person’s relationship with another. So if you do find an investor, make sure to show them how truly thankful you are and don’t take them for granted.
It’s also essential to take the time to discuss the terms of your loan with your new investor. Of course, because you know them, the terms of your loan may be slightly more lenient.
However, it’s vital that you do everything you can to reassure that you will stick to the terms of the agreement at all costs.
The last thing you want is for an argument over money to arise between you and somebody you love!
Be Ready To Face Rejection
Finally, it’s essential to understand that you’ll likely face a lot more people saying no than you will people who will say yes.
It can be hard to face rejection, but you need to make sure that you don’t give up as an entrepreneur!
Just be honest with yourself and the people you approach, understand that rejection will be a genuine possibility, and keep chasing your dream one day at a time!