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What You Need to Know Before You Seek Funding

Seek Funding picIf you are just starting out in the business world, you may be tempted to rush into seeking funding. However, this can be a mistake if you don’t have a comprehensive handle on your business or on the investors’ needs. Keep the following in mind:

Know your business

While this may seem obvious, many new business owners fail to thoroughly examine the major issues that surround their company. If you have ever watched the television show “ Shark Tank ,” you have seen this happen time and again. An investor wants the owner of the business to know everything about the business, its product or service, the market it is trying to reach and the competition. You must also have a thorough understanding of your business model and your financials. You should be prepared to answer any and all questions by an investor.

Discover what the investor wants

By conducting research on what the investors are looking for, you can create an approach that will be well-received by them. What does the investor typically invest in and why? There are numerous books on what most consider in determining whether to invest as a company, as well as many blogs that are written by venture capitalists. Gathering this type of information will be time well spent.

Invest in yourself

Entrepreneurs must understand that the initial influx of cash must come from their own pocket. An investor is not going to hand over a substantial sum of money simply because you have a great idea. They want to see a prototype or some other evidence of what they are investing in and this first step will cost money. Additionally, by investing in your own company, you are telling investors that you are putting your own money where your mouth is.

The Swenson Law Firm is located in Sacramento County and we proudly serve businesses of all sizes from all over the State of California. Contact us today to learn more about how we can assist you with matters such as trademarks, defending lawsuits, business formation, contract negotiations, hiring employees, and protecting your intellectual property.

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