Too many entrepreneurs jump right into raising money before taking these three important steps. This is the main reason for the horror stories you hear about entrepreneurs whose investors are making them miserable. Do these three things BEFORE having any conversations with investors to save time and lots of potential future headaches.
This post talks about the first thing: Get clear on your goals, values, and non-negotiables.
- How many hours per week you want to work
- How much vacation you want to take
- What salary you want to pay yourself
- How big you want your company to grow
- How quickly you want your company to grow
- How long you want to run your company
- What you want to have happen with your company when you’re ready to leave it
- How you want your company to impact the world
- How much control you want over major decisions
- How you want your employees to be treated
- How you want your suppliers to be treated
- Quality standards for your product or service
- Standards related to your contractors (e.g., would you contract with a manufacturer that has been fined by the EPA for polluting?)
- What effect you want your business to have on the environment (e.g., air quality, production of waste, carbon footprint)
- What effect you want your business to have on the communities where it does business
- Your view of the importance of transparency—e.g., whether you want to share detailed information about your company with your employees, investors, and maybe even the general public
Which of these are so important to you that they are non-negotiable? Picture an investor walking up to you and offering a check for a million dollars. What conditions would make you refuse the check?
Of course, your goals and values can change over time as your company evolves. But the clearer you are now about what is important to you, the easier it will be for you to make sure that the way you raise money is in service to those goals and values.
To learn more, check out Raise Capital on Your Own Terms.
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