Whether you approach a traditional bank, credit union, angel investor, venture capitalist, or a crowdfunding organization, you’re going to need a polished business plan, and a great presentation to go with it. The fact is that these entities are constantly flooded with new applicants wondering how to raise funds for a business. In order to stand out and get the startup funding you’re after, you have to shine above the competition, much like you will have to in order to remain profitable in business for the long-term.
Your business plan should include an executive summary, financial projections, management and personnel overview, and a savvy exit strategy to even begin to raise lenders’ eyebrows. Most entrepreneurs find they need help with this long process and hire professional help
New entrepreneurs often find it difficult to attract experienced employees to their businesses. That’s largely because the business is not yet profitable enough to afford the best help, which, of course, costs more. Startups are not normally stable enough to meet long-term financial obligations, especially when one skilled employee can cost the organization more than $150,000 annually.
The choice is a Catch-22. If you can’t pay the prevailing industry wages to attract the best employees, then you are left paying below-market wages to less experienced (and less desirable) workers. If you do hire an employee on at a true market salary, then you may not develop the profitability necessary to meet payroll consistently (or at all) in the future.
Many experts recommend letting the employees share the risks of developing profitability with you. They can start out at below-market wages, and then, progressively earn more as the company does. While this sounds solid enough, the difficulty lies in convincing prospective employees to have faith in the business until profits are rolling in, or at least until you secure enough startup funding to cover their wages.