Posted: September 01, 2009
On management: Convincing people your idea has wheels
Become hopelessly committedPat Wiesner
The would-be entrepreneur was taking yet another class on how to start a business and was pondering whether he would take the plunge this time.
“I have taken lots of courses on business and particularly on starting a business, but I have never really gotten up the courage to do it,” he said. “Many times I have learned how to put together a balance sheet or “guesstimate” a profit and loss statement for a startup. But I have always had so many unanswered questions that I somehow lost interest because I was unsure of myself.”
The speaker was beginning to realize it requires a whole lot more than paperwork … like an idea and a plan and a leader who can excite himself and investors.
First, the Idea Person has to realize there are always three kinds of investors who must be turned on:
• You. The person with the idea. If you don’t reach the point of being “hopelessly committed,” your idea will never see the light of day. You must have passion, energy, will and toughness.
• The person or persons who can give your idea a chance to work. This could be a boss, if you’re trying to get your company to do something new, or someone who could buy into your idea with a resource like money.
• Others important to your success. Your spouse, your co-workers. People from whom you need the investment of “support.”
Investors want to believe. But they have seen it many times, and some things are simply a clear tip-off of bad results to come. When people come in with an idea, the plan often is missing teeth in the financial area.
If these six things are missing, it will kill your new product/new business idea:
1. You must be convinced to the point of being willing to bet the farm. If you are not totally sold yourself, you will not be able to keep your potential investor (of any type) from seeing your hesitation.
2. Your idea must be creative.
3. Your first-year business plan must be realistic and accurate. It should include startup cost, profit and loss and balance sheet. You must understand it!
4. Your plan must have a cash flow analysis that tells exactly how deep you expect the cash hole to get and when you expect to start to make a profit and when you think the initial investment will be recouped.
5. You must think big. Investors don’t like small.
6. You must be realistic in how much it will cost, how many people it will take, how much you will have to give up to get financing or how long it will take to be successful. You must be willing to share your idea in order to get support.
7. You must demonstrate an understanding of the importance of managing things and leading people.
So put together your plan, convince yourself to step off the curb, become hopelessly committed and get ready for the ride of your life!
Pat Wiesner is the retired CEO of WiesnerMedia, publisher of ColoradoBiz. He still leads sales training for the company. E-mail him at firstname.lastname@example.org.