Unless you have been living under a rock, you know that our country is in an “economic crisis”. Sales are down, companies are failing, and the government is giving money to “bailout” some of these companies.
Late last year, the “Big 3” automakers approached Congress together to ask for “bailout” money. The first response from Congress applies to any business CEO seeking other people’s money …
What are you going to do with the money I give you to ensure that you will still be in business and be able to pay me back?
Tail between the legs, the automakers left Capitol Hill and returned later with a plan.
Do not make this mistake with your business!! Whether you are approaching a bank, a family member, or a potential equity investor, always have a plan ready to show them.
Sure, most family members will accept an elevator speech – but give them more than that. A bank will require a business plan. And an investor may not meet with you again if you did not bring a business plan and bombed your elevator speech.
There are so many resources our there to model a business plan from. Books, websites, blogs, etc. The best resource I have found is
“Other People’s Money, How to attract Other People’s Money for your investments” by Michael Lechter, Esq. Using Rich Dad’s Business-Investing Triangle (Trademark of Cashflow Technologies, Inc.), Attorney Lechter leads you through planning and executing plans for raising funds for your business – from banks to investors.
You know your business better than anyone – in a day or two you could have a rough draft done! Then have at least one (if not 2) other people knowledgeable about your business review it.
Even if you don’t need it at this moment, make a business plan … you never know when you will meet a potential investor or need to suddenly expand to meet a large order.
