Set the grounds for real, deliverable expectations
Although startup funding is risky, many investors are eager to support a great idea for a product or service. Raising money for your emerging business via crowdfunding can tempt you to set the bar too high for your investors’ expectations. Based on the assumption that dreaming big has more “bring-in the-bucks” potential than stating one or two achievable goals, your promises might seem too good to be true. Before your investors hop on board with you, they will examine you head-to-toe and decide if you are a realistic entrepreneur (the captain of your ship) or just a daydreamer.
Is studying your market necessary?
Absolutely! Researching your market before attempting to raise capital for your business is a crystal-clear sign you know where you’re headed. Nothing says “invest money here” more than an innovative idea coupled with in-depth research. Two essential questions – “Why is what you do necessary?” – and – “How will it make a customer happy?” – are answered immediately. Understanding your future customers and their needs, peeking in the yards of your competitors and realistically envisioning yourself making an important contribution are powerful credibility enhancers.
As a business founder, you’ll find social media to be one of your most valuable tools – an expressway toward your customers and their feedback. By utilizing Facebook, Twitter, LinkedIn, and other online networks you have direct access to your shoppers at no cost. Constantly posting fresh information about (or related to) your products/services and openly requesting comments and suggestions allows you to create a continuous dialogue with your audience. They will soon become your followers and offer you quality information you can then use to better fulfil their expectations. For increased accuracy in knowing your clientele, survey platforms (such as www.surveymoney.com) can be particularly handy. They supply tools to reach the exact people you’re targeting so be certain to keep a dynamic pace and maintain active, interactive and proactive contact with them.
The value of direct customer feedback is priceless. How else is it possible to fulfill their exact expectations than to have them discuss, or even outright tell you, what they like or what they want? In this era of “prosumers”, independent brand and product advocates have the control to drive your brand/product toward the promise land or off a cliff. The participation of all commenters is free, which is a great resource, but be certain to acknowledge and interact with the more influential prosumers on your social media. Treat them as voluntary brand activists and be sure to keep their activity enthusiastic and positive.
Can too much optimism backfire?
Your future investors need all the information they can get their hands on to build confidence in the business they’re planning to support. Providing them structured, useful and succinct information is a key-point of proving that your business will stay in business for the long run. Building a business plan offers your investors essential details including: company overview, vision, mission, management team, products and services, competition, target market, strategy, marketing plan, and financial forecasts. For guidance in building your plan, we recommend the book “Business Plans for Dummies,” by Paul Tiffany and Steven D. Peterson. We also recommend this awesome online tool for business plan creation: www.liveplan.com. LivePlan is an online platform that builds the plan for you based on your answers to the most relevant questions investors ask.
When building your business plan, make sure you are setting sustainable goals. This translates into having a road map at hand all along your entrepreneurship path. It proves that you – and your business – are real. Keep your excitement to yourself at the dawn of your startup and only make promises that you’re positive you can keep. You set the tone of the communication with your investors. Making your message resemble an election campaign speech and promising more than you can deliver creates unnecessary pressure on you and your business, so remember to be as honest as possible and always (ALWAYS) match your words.
What’s the best attitude to adopt when things don’t go as planned?
If you’ve joined the crowdfunding dance, expect to have your toes stepped on in the beginning until you learn the basics and start to flow with rhythm of the market. In fact, few entrepreneurs got it right from the first trial. Some of the most successful people in the US today have had (at least) one rough fall before succeeding. Donald Trump tripped twice before making his way to the top, Henry Ford’s Detroit Automobile Company went bankrupt prior to being saved by angel investors and Barbara Corcoran’s real estate idea failed before being launched online. If you trip, assess what went wrong and learn from your mistakes before you start again. As John Dewey said: “We don’t learn from experience… we learn from reflecting on experience.”
Having a bright product/service idea and envisioning a prosperous future for it are merely the contour of putting your foot in the door of entrepreneurship. Keeping permanent contact with your customers and investors, building a business plan and being prepared for the best and the worst are the must do’s of a real, tangible entrepreneur.
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