Show me the Money!

Unless you have a rich uncle that has left you a large inheritance, you will most likely need to look at your own bank account to find the money to start your business.  One of the biggest misconceptions for financing a business are that there is FREE government money available to start a business, especially in the form of a grant.   Unfortunately, the truth about grants and loans is that they are not readily available and even if you are able to get a loan, you are going to have to have to use your own resources.  The average entrepreneur needs about $20,000 (at least) of their own funds (borrowing from family & friends, maxing out credit cards, using personal savings) to get a business venture going.  If you think that you don’t need any cash on hand to get started, you may want to think again and run some financial projections.

According to an article by US Bank, “Getting a small business loan from a bank is difficult because start-ups are risky ventures and banks are not known for their risk taking.  That’s not to say that small business loans aren’t out there, just don’t hold your breath.  Grants from the government work similarly.  They’re hard to come by and the time it takes to search for them could be better spent working on the business itself.” With the tight credit market and tough economy, bootstrapping, or the process of starting a business without any outside financing, is becoming the only option for many entrepreneurs.  Do you have any advice for other entrepreneurs?

If you’re not familiar with the term ‘bootstrapping’, you may want to attend a short workshop on March 3rd to learn more about your options for financing a business.  This is the third workshop in the Yakima Valley Entrepreneur Network’s ‘Working Lunch Series’, presented in partnership with SCORE.   This class will focus on financing options for getting your business off the ground, how to prepare a loan package and the truth about grants and free money.  Workshops are taught by professionals with real-world business experience.

• Financing your Business, Wednesday, March 3rd, 2010.  11:30 a.m. to 1:00 p.m.

Held at the Central Washington Business Resource Center, 10 North 9th Street, Yakima 98901.  Classes are $10.00 each if you pre-register or $15.00 at the door and includes the price of lunch.  To register or for more information, call me at 509.575.1140 or email tammy@ycda.com.

Business Plan=Plan your Business

Just how important is a written business plan?  Do you really need to spend all that time with a plan, I mean, you know exactly what you want to do, it’s all in your head, right?  Understanding what goes into a business plan is almost as important as the plan itself. If you know you should do a plan but aren’t sure how or where to start, we’ve got a workshop for you.   I would also emphasize that if you are going to be seeking ANY outside funding, a business plan is essential.

Business Plan Basics is the second workshop in our ‘Working Lunch Series’.   If you are thinking about starting a business, these workshops are for you.  Attend one or all of the sessions to learn what you need to get started.  This class will focus on business plans and you will learn the basic components of what goes into a business plan.  Workshops are presented in partnership with the Yakima Valley SCORE Chapter and taught by professionals with real-world business experience.

• Business Plan Basics, Wednesday, February 17th, 2010.  11:30 a.m. to 1:00 p.m.
• Financing your Business, Wednesday, March 3rd, 2010.  11:30 a.m. to 1:00 p.m.
• Marketing your Business, Wednesday, March 17, 2010.  11:30 a.m. to 1:00 p.m.

Held at the Central Washington Business Resource Center, 10 North 9th Street, Yakima 98901.  Classes are $10.00 each if you pre-register or $15.00 at the door and includes the price of lunch. Register online or for more information, call me at 509.575.1140 or email tammy@ycda.com.

You can also get assistance from  the YVEN Business Plan Assistance Page, meet with a SCORE or SBDC counselor or use a software program.  I was thinking about starting a home-based business on the side a few years ago and ran the projections and numbers through Business Plan Pro and realized that I would be making less than a dollar an hour.  Needless to say, that was quite a bit different than the $50 an hour I thought I would be making!  What are your best tips for preparing a business plan?  In your experience was it necessary and/or helpful?

There is no ‘I’ in Entrepreneur

If you are an entrepreneur or small business owner and haven’t formed a business team yet, you should consider it.  I attended the Northwest Entrepreneur Network Think Tank last week that had presentations from two emerging businesses that were recent winners of NWEN’s First Look Forum.  They both stressed the importance of building your business team, from a CEO, CFO, CPA, to M-O-M whether it is to help run the business, gain financing or even just for moral support so you don’t have to go at it all alone.

Many entrepreneurs have an idea that they want to protect so they are hesitant to bring in an outside person.  This is understandable, so it is wise to choose your team carefully.  The best example was from one of the presenters who said he just wants to be the ‘crazy inventor guy’ so he needed a business partner to run day-to-day operations and, more importantly, come across as more ‘business-like’ in pursuing financing.  In his case, he has a team member that runs the business end of it, and a Chief Financial Officer.

Other key team members you should have access to would be an accountant or CPA, an attorney, a banker, and if you’re married, it might make things easier on the home front to have your spouse on board (maybe not involved in the business, but at least supportive of your efforts!).  Keep in mind that there is free business counseling available through our local SCORE Chapter and the Small Business Development Center.

What other key people should be involved?  Do you have any experience with forming your business team and if so, what lessons did you learn?