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INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | | MARCH 3, 2003 ENTREPRENEUR'S BYLINE By Nelson Davis When the Growing Gets Tough Now that finding the capital to build an idea into a business is harder, entrepreneurs need to adjust their thinking
The legendary football coach of the Green Bay Packers had it right when it comes both to winning games and winning the financing necessary for touchdowns in business. The fundamentals of finding the money you need for your company don't change much. Raising money in hard times varies only slightly from raising money in easier times, but the small differences in technique can have major differences in the result. For the past 13 years, I have had the good fortune, not only of being a small-business owner, but also of operating the type of enterprise that brings me into close contact with hundreds of entrepreneurs. You see, I'm in the TV-production business, and our "star" program is a weekly Emmy Award-winning small-business show, called Making It. On that show, more than 400 business owners who have been interviewed over the years have shared a myriad of techniques for funding both startups and growing enterprises. Along the way, these entrepreneurs have provided hints for aspirants aiming to do the same. In this article, you'll see some of those suggestions, as well as a few of my own. Consider them as you seek to apply the Lombardi principle to today's endeavor of pursuing funding for your venture in a less-than-optimal environment. GETTING GOING. A business startup is usually the hardest of times, no matter the decade or general economic conditions. Here's how I managed to push my own startup ship out of dry dock in 1989: I sold the product before making it. In my case, that meant using videotapes of a similar TV program being produced in Chicago to give advertising prospects some idea of what I was planning to do. When two of those prospects, ARCO, an oil company, and AT&T said they would sponsor a "special" on the subject of small business, I made the commitment to produce it. I convinced my first two customers to pay 50% of the sponsorship cost in advance. They were excited about seeing Making It! on the air, and I told them their help was needed so that I could rent an office and hire an associate producer for six weeks. That money covered the basic production costs, but there was no profit until after the show aired. In other words, until the product was delivered. As soon as the first show was completed, I asked for a 26-week commitment to support weekly programming. ARCO agreed. Get a good contract, and take it to the bank to support a line of credit. Since September 11, many business owners have voiced the thought that these times are somehow different, and that the general economy is slowing. While money isn't exactly running down the street to meet you, it is still looking for a good home! The major question is: "How do you place yourself squarely in its path?" USE WHAT YOU'VE GOT. One lesson from the stories on our TV show is: "Start where you are standing, and go with what you've got." You may already have an attorney and accountant who know your history and your dreams for the future. They are often the most direct connection to financial angels. Ask your professional resources if they know people who invest in business expansions.
 Entrepreneur's Byline comes to BusinessWeek Online readers courtesy of EntreWorld.org, a resource for entrepreneurs that is sponsored by the nonprofit Ewing Marion Kauffman Foundation. Get BusinessWeek directly on your desktop with our RSS feeds.  Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | MARCH |
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