So you think your business is ready for funding?
Posted on 28th September 2018 at 10:43
Three things to help you know for sure It’s a big dilemma – should you bring in extra cash to help you grow and, if so, when and how much?
Have a vision
As with anything in life, having a clear goal to begin with makes you far more likely to achieve it. The first thing I encourage businesses to do, is to have a good think about what they want to achieve, and why. Most, when asked, will say they want to increase their profits and assume they need to grow to achieve that. But that’s not always the answer because bigger also means more overheads, like assets and office space.
So, decide whether your goal is saving towards early retirement, ensuring a steady annual income of building a sector-leading empire, and go from there.
Know your numbers
Once you’re clear where you’re going, getting to grips with your figures will ensure you arrive.
I know from running my own business how challenging it is to get to the bottom of your financial figures yourself, and how tempting it is to hand this responsibility over to your accountant. But it’s pain you have to go through to be truly successful. You need to monitor your money and have an up-to-the-minute understanding of things. like when, in the month, you break even and start to make a profit, and your exact monthly outgoings, because this will help you spot and act on issues and opportunities quickly.
Lastly, it’s vital that you’re organised in how you run your business. Ensure you have clear systems for sales, customer relationship management and other key priorities. Then, make sure your organisational structure and equipment supports that.
There are two basic rules of thumb when it comes to funding. Firstly, know your business and its objectives well enough to decide if you need to bring in additional cash. Then, be professional enough in how you run it to convince investors you are a good bet.
" I know from running my own business how challenging it is to get to the bottom of your financial figures yourself, and how tempting it is to hand this responsibility over to your accountant. But it’s pain you have to go through to be truly successful."
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