The First Step you should take When Borrowing Money
From time to time I am interviewed by business magazines, radio shows and online business sites to provide advice, solutions and/or experience about starting, growing and financing a small business. During a recent interview I was asked about how someone could obtain capital for a start-up company that didn’t have any experience in starting a business before.
I provided several suggestions on what the person could do to meet their objectives. The interviewee found it interesting that the majority of my suggestions didn’t have much to do with getting the exact amount of financing the person wanted.
Financing should be a tool for your business and not the foundation of what the business is built on. You don’t want to start a business with all liabilities and no assets before you even know if the business is going to work. Now some businesses will have to borrow money to get started, and that’s okay, as long as there is a realistic plan to pay it back.
The first step you should take when borrowing money is to write down specifically what every dollar of initial capital and borrowed funds will be spent on. Once you start to write out exactly where the money goes you start to realize you may not need as much as you thought, or you find out that it’s completely unrealistic to do what you want. It’s better to know upfront, before you invest much time or money into your business, that it isn’t going to work out like you wanted and then stop moving forward.
Wouldn’t you rather know that your business will fail in two years before you start then two years from now with hundreds of thousands of dollars in debt?
One of the first steps to take before starting a business is to gain as much knowledge as you can about starting, growing and funding a business as possible. I have spent tens of thousands of dollars over the years on books, audios tapes, seminars and more to learn about running a business. Even today, when I am the one that provides advice to others, I still buy books and attend seminars to gather as much information as I can to be a better entrepreneur.
My personal library of books I keep close to the night stand is a collection of five books I believe provide a tremendous amount of techniques, strategies and solutions for a small business owner to make their business succeed long term.
Those books are:
Good to Great, James Collins
The E-Myth, Michael Gerber
The Art of the Start, Guy Kawasaki
First, Break all the Rules, Marcus Buckingham
Of course, I am going to have my own book series on my night stand. What better learning is there than your own experiences. The series is a collection of stories, experiences, and thoughts, all with real life situations I and my team of experts have gone through. I don’t want to make the same mistakes over and over again so I read through the books from time to time.
Crowd Funding Book by David Gass
11 comments
Hello Mr. Gass,
Thanks for staying touch with me. About the money, I had some help from family and friends and a small loan from the bank to get me started and it was’nt much and that’s all I need, because like you said you don’t know if your business is going to fail in two years, so I am launching this friday taking my samples to my vendor customers and see if my website produces results. For me just starting out as an entrepenure I believe it’s about spreading the news about your product consistently through the internet, the news papers, your business cards, Brochures and so on. The next step I am taking is to go to spotrunner.com and do a commercial with me in it for more exposure. Hey, I’m trying and taking every opportunity I get to see that my product gets the exposure it needs. Later in the near future I want to get my product into the supermarkets and I know that will be a challenge because there’s that slotting fee and that could range btwn:5 to 20 thousand dollars for shelf space, but believe me I am not going to quit, I will continue to move forward until BobbysgourmetLatinodressing&marinade becomes a household name, and my product goes global. That’s my goal, my dream is about to unfold and a new chapter of my life begins now. Please stay in touch, I appreciate your professionalism, and input on business, you are just about becoming a mentor for me. Thanks Mr. Gass. Hope to hear from you again.
Your student and Pupil,
aka
Bobby Latino
Oh! Mr. Gass, I forgot to give my website address, maybe you might want to look at it and let me know what you think. I still have to add my fully produced bottles on the site, and that will be done within one week so the customers can see what the bottle looks like. Talk to you soon.
aka
Bobby Latino
Thanx,David
Thats real good advice for poeple like me.Ive learn alot
since Ive been in the program.Im
looking forward to growing in Trucking/maybe some more equipment to move higher paying
freight.
Melvin
when are you going to make availble again your complete package for building your business (i forgot the name of it was called) but it was your program on building business credit on cd and in books for one special price
I will read the books you have listed. It is good that you are there to help entering level entrepreneurs like me.
I’ve never heard of “The Art of Start” before or that David Gass guy
however the other books I’ve read and agree with completely. In fact, a while back I recommended them along with a few others on my blog. Keep up the good work!
thank’s for the information.
This is quite good chunk of experience for a start-up business.I think it is also important to mention some usefulwebsites for business beginers
Thanks,
I’am so glad to know that you are out there. Awaiting our beginning blunders,and mega mistakes. Thanks for your guidance!Beginning export and import business. MRS. B
I am a 25 year old man, living in South Africa, I have discovered through eploration of success stories such as yours what I would like to spend my lifetime on. I have a passion for change, driven by a motive to do for other people whta they cannot do for themselves and/or by themselves. I have An entrepreneural spirit, descending from a tree that shares no similar interest, rather realistically have not being exposed to varient underluing opportunities that lie hidden somewhere deep within their core. I am determined to live honestly with myself considering all I am capable of and how I can intergrate it with the similar love shared by those i have come accross. My Bussiness model is still on its planning phase, and is to move into implementation from 07/07/2008. On behalf of most of us, I appreciate the knowledge and expirience you contribute in ensuring that we meet our rare potential. All the best in your pursuit to shape a better world for all.
I have been looking for information on how to start a business up,I just found your web site,what I have read so far it’s pretty interesting and the way you present it, it’s wonderful. Thanks for been there for us