Entrepreneurs give up 5% of their companies to appear on the ABC reality show Shark Tank. Some might wonder whether such a sacrifice is worth the opportunity to pitch your idea to “rock stars” like Mark Cuban, owner of the Dallas Mavericks, and a panel of other wealthy investors.
“There is a myth in our culture that being successful in business involves raising money from well known individuals. That’s partially why Shark Tank has taken off. But its not always the case,” says Ami Kassar, founder of MultiFunding, a Philadelphia-area firm dedicated to helping small businesses find money.
In a recent post for The New York Times entrepreneur blog, Kassar talks to some small business owners who had turned down their chance to do the show because they considered opportunity cost too high. In this post, Kassar also looks at other options out there for gaining the funding a small business needs.
Swimming with the sharks. Sean Tice and Kristy Hadeka had a tough choice to make. This pair of entrepreneurs runs a business that makes cheese boards out of slate. But when they received an invitation to pitch their company to a group of super star investors on national TV, they found there was a price attached. You’re the Boss
Practicing your pitch. If you do decide to pitch your idea to deep-pocketed investors, there are some things to realize first. Even when they don’t have their own national television show, these people are busy. Even grabbing their attention with your presentation will require plenty of work and research. Corporation Centre.ca
Adding up the numbers. Before you do any pitching to investors, however, you have to know how much money you really need. Don’t ask for too much, since you will be required to explain exactly why you want it. Conversely, avoid understating the amount of money you’re going to need. You will lose credibility if you can’t operate your business with the funds requested. Startup Professionals Musings
Checking other options. Sometimes venture capital firms and other deep-pocket investors are not a good fit for your small business idea. Get creative with your financing options and tap some sources less talked about but just as available. Using these funding options ensures you won’t be giving up equity in your company. Lonely Brand Blog
Banking for small business. It turns out that one of the best places to go for small businesses in need of capital is a familiar source indeed. A recent survey found small banks increased their lending in August, while big banks offered fewer loans over the same period. Alternative lenders also increased the amount of money offered to businesses last month making them another viable option for small businesses. Small Business Trends
Starting with Nothing
Bootstrapping for beginners. Still another option for business startups could be to begin with no money, or at least no outside funding at all. In this podcast, bootstrapping expert and entrepreneur Bijoy Goswami talks about another option for starting a new business. Small Business Elevator
Suggesting bootstrapping principles. Here are some suggestions for an entrepreneur who’s decided to take the bootstrapping approach. Tom Ewer calls these suggestions “principles”, however bootstrappers may use a variety of approaches. It’s important to find a solution that works for you, but Ewer’s post is a great place to start. MyWifeQuitHerJob.com
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