Posted on April 16, 2012 07:34 am under Diary of an under 30 CEO, Entrepreneurs
By Ola’ Jacob Ajayi
“The secret of my success is a two word answer: know people” – Harvey S. Firestone (Founder of the Firestone Tire and Rubber)
VENTURES AFRICA – Starting a business is all about self-sacrifice and luxury denial. Everybody wants to use a Porsche (Car and Phone)- a dedicated monthly savings over a period of time can make this happen. But how many people are willing to commit the same level of dedication saving towards launching a business?
As a budding entrepreneur, the first source of capital for your business is “YOU”. How do you convince potential investors to finance your idea if you don’t even have any capital capacity to push? The only way to do this is if you have a past success that speaks for you. Imagine Dangote trying to raise money for a new venture – his idea is enough to get funding based on his past and present success.
We receive different e-mails daily with the same big question- how do I raise capital for my business? It will take me 20 years to save up for my business. How much do I really need to get started?
Most ventures started by entrepreneurs were bootstrapped before investors took interest in them. Forget what commerce taught us in school about the source of funds for a sole proprietor being but not limited to family, bank loan, investment etc.
While some investors might believe in your sweet business plan, others would not. Not because you are not doing something right, but because they would rather spend their hard earned cash on something else. If your family does not invest in your business why do you think the bank would? Not to mention your lack of collateral.
Instead of withdrawing back into your shell because of the lack of money to start your business, come to terms with the fact that you are the only one who can breath life into it. Once you get the business off the ground, people will come begging you to invest. But you must take that first important step of saving for the big launch!
Are you ready to do away with some luxuries? Ready to sacrifice now for a better future?
The following steps could be of help:
1. Go for what you need, not what you want. Research shows that we can do without 7 of every 10 things we buy. This gives you an opportunity to save a good part of your income.
2. Be ready to push your idea with every penny you have now. Ever heard of the quote “done is better than perfect?” A running business gets investment faster than a business that is sketched on paper.
3. Have plan A to C for your business. If investment doesn’t come, what happens? Wind up? Hell No! Find a means to push it slowly till the business is self-sustaining.
4. Know People – the power of networking must never be underrated.
5. Make some noise about your business – people can only appreciate and get interested in what they know. Quality service and media attention will do this for you.
6. Be a unique solution provider. You can’t be another Facebook. You need something better to catch my social attention online.
7. Have a plan for how the dollars will keep pouring in. Investors are more interested in how much profit they will make. They are not Santa Claus.
Have you started saving yet? That 9-5 that pays well is not a bad springboard! Remember: Nothing Ventured, Nothing Gained!
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