5 minute read
Funding Start-Ups by Greg Gilbert
DAY 32 FUNDING START-UPS
By Greg Gilbert
Advertisement
Co-founder of First Monday.
@giezcubed
I’ve done wealth management since 1995. So for 18 years in the industry, I have known that I want to help deliver financial council as objectively as possible. I love something you can trust and that is unbiased. It’s what I’m looking for when I’m seeking out information, so that is what I’m trying to offer as well. I’m hoping I’m giving business, life, money, and personal council as objectively as possible.
I work with high net worth clients who need good advice. I get to work with some really neat leaders who have businesses and are busy on the work and family front, so having someone for them to
bounce ideas off of helps them maintain their calling and know how to make the greatest impact with their finances.
I love the work I do because it’s who I am. I am by nature entrepreneurial and a creative thinker. I approach finance with a creative bent, and want to see my ideas through. It connects with me when I see good ideas. I love talking business and leadership. Part of business is funding, so I want to help others think through strategy and capitalize their ideas.
A few of my clients invest in small business, so on the objectivity side, I get to help people invest money, pay down debt, and make good decisions. I want to help them do the right and wise thing. I’ve seen people gamble on financial decisions and fail, but I’ve also seen them be successful. I love
learning what makes people successful, so I can replicate council for others who are starting something themselves or investing in someone else’s idea.
Through my years doing this work, I’ve learned what are the criteria to a successful venture and what makes it LESS risky. As someone who
understands how hard a start up is, I can attest to how easy it is to feel lonely and on your own.
At the end of the day, the majority of the work and responsibility falls on you, and that can be a lonely place. I have a heart for the leader going through that experience, so to be able to help them think through finances well.
In working with start-ups, I have seen some
mistakes that can be avoided. I was at a conference 2 weeks ago and there was a brilliant guy named Nassim Taleb speaking. He’s written a lot on risk. He teaches that if you can eliminate
mistakes, you’ve come a long way in achieving
your idea. Start-ups make a LOT of mistakes. It’s helpful to be around people who have been there before, to help work through the mistakes. If you
can watch what they’ve done and do things differently, you might be able to achieve greater success.
Eric Ries, author of The Lean Startup, talks a lot about the minimal viable product. His point is that a lot of energy is wasted on trying to sell the WHOLE idea. Start with the minimal viable
product, strip away the extra stuff, and build.
Think about Chick-Fil-A. They started with making a good chicken sandwich and built from there. They had to take steps to get where they are now. But they started with a great chicken sandwich.
All the big idea stuff is great, but how much time and money has been wasted going after the whole idea when you don’t even know if someone likes your chicken sandwich? It speaks to actually doing the work to refine your idea. Less money will be needed, there will be greater results, and there will be greater authenticity and transparency. It’s a beta test, essentially. It’s hard work to see what the ONE
essential piece is and if anyone even likes it.
If it’s interesting to me, then an investor can begin asking if there are revenue streams and then learn to build from there. Start small and build. Do the hard work of filtering it down. It takes a lot of work to think small when there are so many great ideas. You’ll want to begin making your idea bigger. But
filter it down, and make it successful first. Then build.
Another mistake I see people make, is not knowing how much it’s going to cost. It’s ALWAYS going to cost more than you think. Whether it’s from donors or a service and a product, it’s going to cost more and the revenue is going to take longer to make than you think. You have go in with the
bazaar approach of getting people on board and being excited, while carefully watching
your cash flow. There are two ways you can lose track of your cash flow. Your idea can either not be well enough funded, OR you have too much money going out. Ask the question, “What’s essential for RIGHT now?” Use carefully what you have while you’re building on the idea. New authors often borrow the credibility of others by having someone with influence write their forword. It works similarly in business. Borrowing credibility is asking who’s doing the forword, so to speak. If you’re stepping out for the first time,
ask the question, who shares an alignment with
me? Who already has credibility? Other people in that industry will recognize your good work, if you haven’t had enough time to gain your own experience.
If your start-up is a non-profit, it would be great to have people involved who already are doing the hard work. Ask them to be on your board or an advisor.
You also borrow credibility by how well you
present when you’re sharing your idea. Are you researched and prepared? Are you authentic? Are you the kind of man or woman others would want to be involved with? Do they trust you with their money? It’s a HUGE statement of their trust
if they come on board with you, so are you the kind of person someone wants to work with?
Are you on top of it? Do you present well? Can you answer the hard questions?
Lastly, from whom are you seeking council? Don’t just ask for it when you need something. In the council of many there is wisdom. Whatever it costs you, surround yourself with understanding, in every area of life. Lean on the people around you, who
WANT to help you succeed.
When I think about what makes ideas attractive
to funders, it boils down to a boring word that means a lot: Credibility. Either you are credible and you have the experience you need OR you need to start BORROWING credibility. You borrow credibility by who you have involved in your project.
