Today’s Ask The Expert Post is from Dr. Letitia Wright America’s Crowd Funding Strategist! Be sure to Join us for at Stiletto Wealth Experience 2012 In November where Dr. Wright will be sharing her crowd funding know how on our financial resource panel.
There is nothing wrong with Indie GoGo and using it for crowd funding. But what happens when it all goes wrong? What happens when no matter what you do, you just don’t raise the money? This is really what this article is about. There have been plenty of successful people on Indie GoGo. If you follow a few rules, you will find success there too!
Understand what crowd funding is: Many people think crowd funding is just a bunch of people on social media handing you money. You just put the link on your social media and if 10% of the people click and give, you would be a millionaire! I am not sure how that rumor started but that is NOT how it works. Social media is a part of it, but only a part. You have to understand the strategy behind a successful campaign. You have to know what they did and be able to duplicate it. For example, if someone tells you they had a mailing list of 10,000 and they send each one three postcards. You have to look at your situation and figure out if you have the budget to do the same thing. If you have the budget, you must then find out what they had on each post card and how far apart were the mailings done. If you can’t duplicate that, then that strategy won’t help you as much as it did the other person.
Create a specific plan: For most people the plan is the basic 2 x 2 x 2. You know this plan. They have 2 websites to choose from- Indie Go Go or Kickstarter, They have 2 sets of people to share with- Their family and everyone else, They have 2 ways to get the word out- Emails and Social Media. That plan won’t work, as the millions of people who have tried it. Many people go into crowd funding without a budget, so the 2 x 2 x 2 plan is the only one they can afford. Your plan has to be more specific than that. There are over 500 websites to choose from and the list grows daily. If you only know of those 2, you have not done your homework. If you are only going to do a few emails and social media then you are making it hard. Most people do not have a large enough list for that to work.
Be sure you can deliver on your gifts: After you raise the money you have to perform. Currently, this is not a huge problem. There are some people who have not performed but no real scandal has happened in the industry. You don’t want to be the first one either! This is your tribe, if you scam them, it’s about you and your brand that is damaged. Almost no one does this intentionally. Be sure you budget enough money to do what you say you are going to deliver. There are a lot of hidden costs to doing crowd funding.
Dr. Letitia Wright is America’s Crowd Funding Strategist and has created a video series for those who are about to start crowd funding. You can access these videos at www.acflife.com
The Money is Already Here! It has not left the planet.
Contrary to popular belief and the financial doom and gloom stories you here on the news, Money HAS NOT left the planet. The biggest objection I hear from people working with me is, “I would love to, but I don’t have the money”. AND I know it is the biggest struggle you have when landing clients, as well. Out of all the objections for people to get the help, support, coaching, or consulting they need, money is the biggest. I have spent a lot of time finding ways to coach people into reality. The reality is two things:
1) We always have the money to do the things we REALLY want to do.
2) You always get exactly what you need when you need it.
If you believe Universal Truths of Abundance you will know the money is always there. Now, I do know some people do not know where to look for the money and that is where I come in. I thought it would be very helpful to share this with you for two reasons:
First, you might be telling yourself you can’t get the support you need because YOU don’t have the money.
Maybe this will help.
Secondly, it will help you in speaking to clients who say they don’t have the money.
So, here we go – 10 ways to get the money you need every time!
1) Business Loan. There are many small lending institutions (especially locally owned banks) that want to help finance small business because the entrepreneurs are doing well in this economy.
2) “Business Loan.” This is what I call a job or part time job. I think if you TRULY believe in your dream then you must do whatever necessary to realize that dream. A stream of income will help you go from NEEDING clients to wanting clients. And do not look at it as a job – it is a business loan to fuel your start up.
3) 401ks and other investments. Your accountant will probably tell you this is a horrible idea but is very possible to used some of your retirement as seed money. That money can definitely be used to grow your business. With so many retirement accounts shrinking with the craziness in the market be very aware that one very good investment you could make is an investment in YOU. There are even ways to roll the funds into your business with NO penalties.
4) Low Interest Rate Credit Cards. We have a really messed up view of credit in this country. Debt has been made to seem evil (I could go on for days about this), but good debt is a very useful tool. In fact when structured properly business credit cards will not show up on your personal credit report so there’s no negative impact to your FICO score for having to much debt. Good debt is debt you incur to finance a project or dream that will give you a return on investment and you have a plan to pay it back. You are using it to learn, grow, and develop to bring in revenue from your business. No one really blinks at student loan debt, but we all get nuts when we, say, put a coaching program or mentor on a credit card. What’s the difference? There isn’t – at all! One has just been conditioned by society to be okay. Check out the Cash Flow & Capital Secrets course.
5) Got Junk? I have had clients (actually right now) finance their dreams by selling gold, putting cool stuff on ebay, or selling a car they no longer wanted or needed. David Neagle, first financed his dream by selling a boat. Suzanne Evans spent a year selling yard sale finds on ebay to pay for a vacation AND her coaches. See how creative you can get?
6) Get Started NOW! Many of you are waiting to have everything perfect or in place to get clients and make money. I guarantee you know enough now to start working with people. Maybe you will have an introductory rate or special for the first 5 clients you work with, but there is no need to wait. You can start making money now!
7)The Bank of Friends and Family. Many times friends and family are happy to help and will charge you a much lower interest or no interest. If you are in the UK, Australia or South Africa, Richard Branson has made this very easy with www.virginmoney.com He has created a program that helps friends and family create loans and have tracking, accountability, and make them professional and organized. He calls them social loans. Crowd Funding is a more widely used term.
8) Make a Cash Flow Change. Look at your full budget and spending – I have never seen one person or family that didn’t have something they could tweak to find money for their business. Is there a tweak that could be made to your daily spending? Hobby spending? Where is there waste in your weekly budget? Are there services you haven’t used in 60 days or longer that you pay for every month? If so, cancel them. You can always start them again if you need them in the future. It can be amazing how easy it is to find $100 or more a week with small changes.
9) Apply For a Home Equity Line of Credit. Some banks offer home equity lines of credit that let you borrow up to as much as 85% of the appraised value of your home. Depending on the value of your home and what you still owe in other mortgages, that can put a significant chunk of money at your disposal for starting your business. The downside: you’re putting your home at risk. This is not an option for everyone, but it is a great option for some. Always understand your risk and all the details.
10) Make The Decision. You or your clients do not need the money for coaching /mentoring/support until they make the decision to get support and play a bigger game. Anything is possible when you make a decision. Many people think they have made a decision, but here are the facts. A decision is ONLY when there are no other options. There is no failure or stopping buckets to put your balls in. You do whatever it takes. And you will get the support you need to make it happen because when you decide, heaven moves to support that decision.
There is divine provision waiting to fund your dream! Heaven is ready to move on your behalf. The money is already here!
Want to use this article on your website or your own ezine?
No problem! But here’s what you MUST include:
Shameca Tankerson, is a Speaker, Trainer, Author, and Cash Flow Success Mentor to entrepreneurs and service professionals. Using a proven system, she opens a candid dialogue about money that teaches her clients how to breakthrough to their next income level and expand into a cash flowing business with a new collaborative business model that is liberating, Inspiring and Powerful. To Get your F.R.E.E. “Spark Your Cash Flow Financial Success Kit” – Making Room For Money: 5 Financial Mistakes Entrepreneurs Make That Sabotage Their Cash Flow (And How To Avoid Them). Visit: http://www.MakingRoomForMoney.com
This Wednesday is going to change how you look at funding your business forever.
Hint: It has nothing to do with lists, nothing to do with business plans, having a big business, or perfect credit; and nothing to do with you walking into a bank at all.
In fact, you are about to learn how to get the money you need to do what you do best and take your business to the next level.
Meaning? Your Funding Problems are FINALLY REALLY OVER!
You need to be at on this call if you:
1) Are short on cash and can’t find money to start or grow your business quickly
2) Don’t know where or how to get the cash
3) Feel sick because you lost out on a great opportunity to sponsor and event and watched as other business owners took the opportunity and put profits in their pockets
4) Lack the confidence to raise money
5) Are frustrated and feel stuck
Wednesday April 18th at
6 p.m. PST
7 p.m. MST
8 p.m. CST
9 p.m. EST
Get Your Spot Here:
In this 90 minute call, I’ll open the door for you to receive an unlimited amount of money for your business – so you can finally kiss these problems goodbye:
1) No Cash
2) Losing out on lucrative business opportunities
3) Maxing out and Paying high interest rates on personal credit cards
4) Using Up Your Savings and Retirement Accounts
Were going to show you how to get in under the normal business lending radars and get exclusive, fast-pass access to funding for all your business needs (without ever having to walk into a bank).
Looking forward to it,
P.S. This strategy has made all the difference in the world in my clients’ business. Now you can do the same. Get registered and we’ll see you Wednesday night:
Want to use this article on your website or your own ezine?
No problem! But here’s what you MUST include:
Shameca Tankerson, is a Speaker, Trainer, Author, and Cash Flow Success Mentor to entrepreneurs and service professionals. Using a proven system, she opens a candid dialogue about money that teaches her clients how to access unlimited business capital, breakthrough to their next income level and expand into a cash flowing business with a new collaborative business model that is liberating, Inspiring and Powerful. To Get your F.R.E.E. “Spark Your Cash Flow Financial Success Kit” – Making Room For Money: 5 Financial Mistakes Entrepreneurs Make That Sabotage Their Cash Flow (And How To Avoid Them). Visit: http://www.MakingRoomForMoney.com
As a woman entrepreneur, whether your business is robustly moving forward or you’re just getting started, its common to have a bit of “emotional baggage” (or negative money B.S. as I like to call it) you may be carrying around, that is slowing you down. For example, maybe you have debt or perhaps you’re ready to increase your fees. but you’re feeling a slight twinge of guilt or fear that people won’t pay. Or maybe you see the perfect mentoring program you want to invest in but your spouse is skeptical that it will be a wise investment. Once thing is certain, if you carry past baggage with you into the new year, you’ll have a much tougher time creating success. which is why this is the perfect time of the year to give your finances a fresh start.
The mistake that most women entrepreneurs make is not knowing exactly what type of financial actions they should take. Let’s be real, it just isn’t a topic that is discussed. which is why i’m sharing 3 of my BEST tips with you on how to give your finances a fresh start as you head into the new year. And while you may not be able to wave a magic wand or sprinkle a little pixie dust and magically make your debt dissapear or make your husband change his mind, you can create a plan that addresses the emotional and practical aspects that make of every woman business ownere’s financial future.
Tip #1 – Stop Being A Victim of The Past and Falling Prey to Your Money B.S.
Women hold themselves to a level of perfectionism that leaves no room for mistakes. Trust me we’ve all lent money to people we shouldn’t have, let worrying about what others think keep us playing small, given away our power with money, or we’ve made decisions to purchase something that we later regretted. You can’t change the past but what you can do is stop carrying it around with you! So instead of feeling guilt or shame or blaming fate or circumstances for what’s happened, learn to forgive yourself. Forgiveness is an act of the will, extreme compassion and understanding for the tiny part of you that was doing her best when you made those decisions.
Tip #2 – Don’t Let The Debt Demon Stop You From Growing Your Business
I often this from many women entrepreneurs, ” Shameca, how can I invest in growing my business when I have debt?” Or they’ll say, ” I don’t want to pile on more debt”. First realize the best way (or chance) to pay off your debt (most likely) will be by growing your business, because you’ll have the increased cash you need to make more than your minimum monthly payments. Next, understand that investing in growing your business while you may still have debt makes perfect sense if you are committed to taking action and implementing. I’ve metored hundreds of women entrepreneurs on my simple cash flow debt pay-off strategy and i’ve discovered that those who take massive decisive action in their business are the ones who also pay off their debt faster than others.
Tip #3 – Create Boundries Around Money That Empower You And Others
Women tend to cave in on their boundries because in some way they feel responsible for other people’s feelings. But giving in means giving up on your self-respect and losing the respect of others. And those yucky feelings and negative energy ofter flow through to other areas of your business, impacting your fees, the types of clients you attract, and so much more. My advice? Its far better to experience a moment of discomfort while upholding a boundary than it is to untangle a money mess later on. No I’m not saying you need to be the wicked witch when it comes to maintaining a boundary. Boundaries are easily upheld from a place of kindness, consideration, and connection, all of which helps you stand in your power with confidence!
Want to use this article on your website or your own ezine?
No problem! But here’s what you MUST include:
Shameca Tankerson, is a Speaker, Trainer, Author, and Cash Flow Success Mentor to entrepreneurs and service professionals. Using a proven system, she opens a candid dialogue about money that teaches her clients how to breakthrough to their next income level and expand into a cash flowing business with a new collaborative business model that is liberating, Inspiring and Powerful. To get your F.R.E.E. “Spark Your Cash Flow Financial Success Kit” – Making Room For Money: 5 Financial Mistakes Entrepreneurs Make That Sabotage Their Cash Flow (And How To Avoid Them). Visit: http://www.MakingRoomForMoney.com
At some point in time, the reality with most businesses is that fluctuation periods would eventually come and such companies will have to face problems regarding their cash flow. A company may experience a financial crisis wherein more cash may be going out than entering as profit.
It is very important for any enterprise to never run out of funds. Having an unsecured business line of credit could make all the difference. Assuring that your company has an unsecured line of credit will be a big step of precautionary on your part to keep your company afloat, even when faced with financial crises.
What Is An Unsecured Business Line of Credit and How Does It Help?
An unsecured credit line for your business is a type of financing resource that can provide your company with the money that it needs without requiring collateral. Having such a credit line for your company can be of great benefit, especially when faced with problems on cash flow. This can provide you with the temporary funds that your company may need for operations to continue.
In running your own company, sometimes being prepared for possible problems play a big role in helping you ride the tides of business. For sharp entrepreneurs, even when there is no immediate need for the extra funds, having an unsecured credit account at hand will be a good cautionary tool for anything that could possibly go wrong with the business.
After all, you can never know exactly when your company might experience cash flow problems. But knowing that you have back up when funds become unexpectedly tight through unsecured business lines of credit, will surely set a whole lot of difference for your business to step up the ladder.
Funding is a major challenge to consider when embarking upon the journey to start your own business. Figuring out where the funds will come from can sometimes become very stressful. This is an obvious obstacle that ultimately prevents many people from starting their own small business.
Bank loans are usually the step that most people take when wanting to start their own small business. Banks do tend to make it tough on the every day person wanting to start their own business.
Obtaining government grants is not as easy as one may think. The US as well as other countries has numerous programs that cater to the needs of potential small business owners.
Relatives or friends
The downside to the suggestion of relatives or friends is that they very well may feel that they own a stake within your business. This of course has no legal binding however; it can create serious rifts between you and your loved ones.
Your personal savings
Dipping into your personal funds is yet another way to fund your small business. This is usually done through a cobination of pulling from savings, retirement, and home equity and is not a recommended way of funding business ventures. It becomes extremely important for a succesful business to seperate business and personal finance.
Private donations or investors
If you feel you have a great new idea for a new small business, you can possibly sell your great idea to potential investors; these are commonly called venture capitalists. The disadvantage of this method is that the idea has to be creative as well as unique; you have to literally convince the investors you are going to make money.
Trade Credit and Unsecured Business Lines of Credit
These are two option often overlooked in funding new business. Trade credit and credit lines in the name of the company are easy to obtain if your business has a strong business credit profile seperate from the owners personal credit.
Heres a solution that may provide you will all the working capital your company needs. Most business to business sales usually carry 30 to 60 day payment terms. This means that you must deliver your products or services now. However, your client has between 30 to 60 days to pay you.
This creates a significant challenge for business owners. The is a potentially huge problem that has a simpe solution. Your clients want to pay you in 30 to 60 days, but you must pay rent, payroll and your suppliers now. As you can see, the math does not work. Unless you have a substantial bank account, this leads to an almost impossible situation.
If you are in this situation, it is also very likely that the bank will not be able to help you. As you well know, banks tend to lend to businesses that have three years of profitable operations and significant hard collateral. If you do not qualify for bank financing, your best bet may be to consider factoring.
Factoring is a business financing tool that helps business owners who cannot afford to wait 30 to 60 days to get paid by customers. Factoring provides you with the necessary funds to meet payroll, make rent and pay your suppliers on time.
As opposed to bank financing, factoring is easy to qualify for. The main requirements are that you have a business with a strong roster of commercial clients. Approval is based on your client’s credit and not yours. Factoring is also easy to use and it reduces the time you wait to get paid from 60 days to 2 days.
Factoring financing is an ideal tool for companies that are growing and that cannot afford to wait to get paid by the clients. It helps you to stabilize your financial situation and positions you for growth.
Statistics show that more than one million people in the United States start a new business each year.
That number would be much higher if all the would-be entrepreneurs had the financing required to get a business up and running. In order to accomplish their dream of business ownership, entrepreneurs are finding new and innovative ways to finance their new ventures.
One of these new financing options is the use of a person’s existing retirement funds-a pension, profit sharing, 401(k), IRA-which allows that person to start the business he or she has always dreamed of without tax penalties, consequences or mountains of debt.
Funds can be turned into useable capital for business investments or operations. If a person has more than $20,000 in a retirement account and is not currently employed by the company that holds those funds, he or she qualifies for this Small Business Administration (SBA)-recognized approach to finance and start a business.
Retirement funds can be used for any business purpose. Could you use money for any of the following reasons:
- Purchasing a franchise or existing business
- Start-up expenses, such as purchasing property, and equipment.
- Working capital, including paying salaries, and franchise fees.
- Business expansion, such as funding additional franchises, and locations.
- Equity toward SBA or other loans.
Funding your business is as simple as these four steps:
Step 1: Establish a C-corporation.
Step 2: The new corporation creates a retirement plan.
Step 3: Funds are rolled over into the corporation’s new retirement plan.
Step 4: The new retirement plan purchases the stock of the corporation.
So many people have watched their dream of owning their own business go out the window due to lack of funding options. We help entrepreneurs, coaches, consultants, and services based businesses achieve that dream every day.
Business startup funding is an absolutely critical element in launching a successful business. If you assess your personal and business expenses, eliminate the extras where possible, and asequately plan for sources of alternate capital then you should be able to secure adequate business startup funding.
Business startup funding is always a huge worry. Do I have enough money to start? Can I quit my job to concentrate full time? Will I be able to cover my monthly expenses?
When the time comes to actually launch your business you must have done your homework regarding your business startup funding needs. The truth is you need to be prepared so that if the opportunity to accelerate your launch presents itself, you’re ready.
Assess Your Personal Finances
Take out your checkbook and credit card statements and review all of your personal expenses. Total up your personal expenses. Have you ever heard the saying, “how we do one thing, is how we do everything”? If your personal check book is out of whack, chances are your business check book will look the same. If managing finances is not a strong suite, then you may want to outsource that part of your business. That will be an additional expense you will need to account for.
Take Inventory of your personal credit. If all three credit scores are not above 720 or you have high balances on your credit cards, you have work to do. Develop a plan to pay your balances down and begin taking steps towards improving your credit. Get educated and learn as much as possible about how these areas affect your ability to get funding.
Evaluate Your Business Expenses
Another element of business startup funding is your minimum business expenses. Luckily, coaching, consulting, and service based businesses are not a capital intense ventures. You will have business expenses to cover though, so you must analyze what those are and figure them into your business startup funding needs.
Do the Math
Total up your personal and business monthly expenses. To launch a successful business you need to have at least six months of cash in the bank OR an alternative source of affordable capital. Many people won’t have 6 months cash to cover their business startup funding needs. If this is you, you will need to find, or keep, a job.
Securing adequate business startup funding is one of the most challenging aspects of launching a small business. You don’t want to minimize its importance though. Inadequate business startup funding is at the root of many business failures.
The Bottom Line on Business Startup Funding
Having enough business startup funding means being prepared and applying to all the funding you need early. You have to know where your money will be going and have enough to cover 6 months of expenses. Be really clear on this. There are plenty of practical ways and opportunities of securing the funding you need. There is money available you just need to learn how to get it.
How much would it help if you could access $25k, $50k, or even $100k for your business? Have you ever made a decision to not invest in your business because of money? Today at my Jump Start Workshop i worked hand in hand with 12 business owners just like you; Showing them strategies to get the money they need to start, invest, and grow their business in this weak economy!
It really is no Accident. I can show you how too. Don’t Miss The Next Workshop!
See what they have to say:
Steve Halen, My Trade America “I got 3 credit lines set up today!”
Danielle Moruffo, Elite Financial “Shameca is Awesome!.”
Jodi Rubin, Window Wonders “I got $72,000 in 3 Weeks!”
At The Workshop You’ll Learn:
- 7 Steps to Funding Your Business Using Other People’s Money (OPM)
- A Secret Super Tool To Get Easy Funding That’s Often Over Looked
- How to Get $25,000 in as Little AS Two Weeks
- The Thought You Are Having Right Now That Stops You From Getting Approved and How To Over Come It!
- Simple Strategies to Unconver Hidden Profit & Cash in Your Business