3 Secrets of getting funding for your start up – and why it matters to freelancers

What are the 3 secrets to getting your start up funded?

In order of priority, the 3 critical factors that will determine whether your start up gets funded are…

– people
– people
– people

That is does your startup proposition have…

1. People who are passionate about your market place

People who live and breath the jargon – but who can also speak English when required. People who understand what matters in that market place and know – just instinctively know it – how to develop products and services for that sector.

The sector might be fashion – but for large sizes or for kids or metrosexual men or the working woman, or the digital sector, or tech or energy or medicine etc… No matter, is there someone on your team who can predict the future – albeit for that tiny microcomsm? If not, you won’t get funding.

Let’s call these the product people or inventors.

2. People who get the commercial realities of your proposition

These people understand, and are not jealous of, the investor and know how to implement.,

People who can lead and embrace the new people who will be needed to take the business (yes, business, not the product/ service) forward. These people need to demonstrate an understanding of profit and loss, know how to manage a very lean budget and someone who loves success and hates waste.

This person also needs to connect with the inventor or creator. They need to be deep in the same market place – but with a commercial perspective. And they need to be able to plug in and unplug various marketing and sales opportunities that the business can generate.

They are the people to hire your marketing, sales, PR, digital and creative teams, and set the briefs and define the goals. And they need to know how to fire too.

In many ways, they are the glue between the first set of product people and the last set of people. Let’s call these the business people.

This group of ‘business’ people are available on a freelance contract basis – they can provide all manner of skills and leadership if needed. Often the start up entrepreneur can provide some of these skills, but mostly, this area is where the gaps will lie…

… and that is the opportunity for marketing, sales, digital and creative freelancers!

3. People who provide the cash – but sometimes the boot.

These are the people who don’t want profits in order for the money to be reinvested to grow the business empire of your business manager. Instead they want dividends paid to shareholders and / or the opportunity to sell their stake at a x10 profit.

They will care deeply about how much the business people want/ try to pay themselves and then, they will question re-investment of their dividends. ‘Why will money in the business give me a better return than money in my bank account’, they will ask?

Yes, the natural interest of these people will include making introductions, giving feedback and sharing advice. But they are not there to do the heavy lifting.  However, they will probably have invaluable experience when it comes to selling companies.

Let’s call these the money people. As business angels they are likely to be more involved on a day to day basis – and professional investors will be less closely involved – but this is not always the case and depends on the individual people.

So, to sum it up

Your business needs product people or inventors, business people and money people if it is going to raise funds and persuade investors to part with their cash – and leave it in your business once invested.

A business seeking funding needs all three.

Sometimes one individual can meet all three roles – inventor – business – money – but if so, he or she will be smart enough to hire in expertise in all three areas – no doubt, on a freelance basis.

So, it is not a given that the entrepreneur needs to share equity – he or she can buy in missing skills as and when needed and borrow money from a personal account or possibly a bank.

But, in all and every case, the successful entrepreneur will be able to hire in these skills to grow the business. If not, the business will never become more than a pipe dream or remain a one person consultancy.

Therefore, even if you decide not to raise funds and share equity, you do need – in every case – to be able to engage talent and skills to take your project forward. And that is how the Brookson Enterprise Freelance Fairs can help – (Manchester 9th November, Daresbury 19th November) they will introduce you to more freelance business, marketing, sales, digital and creative talent in a morning than you would normally meet in a month – all for less than the price of a meal.

And freelancers get to meet the open minded growth businesses of the future – who recognise the value of flexible working and are keen to get on with the job.

All in all, a great combination.

Be Sociable, Share!

Written by Editor on November 4, 2010 and filed in Entrepreneurs, Featured, News, Opinion , , , , ,

Get Adobe Flash player
Read previous post:
5 Tips on how to avoid the feast and famine of work

Does your work swing between feast and famine? Read our 5 top tips to see what you can do to calm the work...