There’s an urban legend about a guy who posted a crowdfunding cause to “help him make the best damn potato salad,” and the legend is, he made a couple of thousand dollars doing it.
I did some digging on the world wide web and was able to verify that this did occur in 2014 on the crowdfunding site Kickstarter. The guy made Zack Danger Brown didn’t just make a couple thousand, he made $55,000 just posting a prank. With the money, he threw a huge party called Potato Stock.
Imagine what you can do as an entrepreneur or philanthropist who has a real cause or really great idea for a product or business. If you aren’t sure what type of crowdfunding site is right for you, I found two great articles that might help you weigh your options.
In doing this research, I came across a lending site that I had never heard of called Lending Club. In short, they link individuals and small business owners to investors through their platform. I’m going to be researching this one more in-depth as part of my ENT 650 coursework.
Rogers, S. (2014). Entrepreneurial Finance: Third Edition, Finance and Business Strategies for the Serious Entrepreneur. 279-294.
“A bank is a place that will lend you money if you can prove that you don’t need it.” – Bob Hope via goodfinancetips.com
This week we are choosing topics to research that pertain to raising funds for entrepreneurial pursuits. We’ll be publishing an article in a few weeks about the topic we research, and I chose a pretty traditional form of funding to explore. My topic is “Loans & Lines of Credit (to include SBA guarantees)”.
So far, I’ve learned the Bob Hope comment about banks loaning money only to people who prove they don’t need it is entirely true. Most banks are pretty risk-averse. This explains the popularity of other non-traditional forms of funding for modern entrepreneurs; options like:
- Angel Investors
- & Business Incubators
For entrepreneurs who have collateral to offer and/or extremely great credit, traditional loans and lines of credit can still be a good option but are usually not the only option to pursue. As I conduct more research, I’ll post the whole article on my blog to share.
In the meantime, I’d like to share a couple of thought-provoking pieces about funding.
The first is a quick bit of advice posted on Entrepreneur.com from Amy Williams, CEO at Citizens of Humanity on choosing investors wisely: https://www.entrepreneur.com/video/310046
The second is an interesting article about the story you tell when pitching a start-up to investors. It’s an HBR piece called Startups That Seek to “Disrupt” Get More Funding Than Those That Seek to “Build” by Dana Kanze and Sheena S. Iyengar.
I hope this gives you some food for thought until my next post.
“Dogs have no money. Isn’t that amazing? They’re broke their entire lives. But they get through. You know why dogs have no money? …No Pockets.” – Jerry Seinfeld
I started a new class last week in my Masters in Entrepreneurship program at Western Carolina University. It’s a class that I was dreading a little bit. This one when I registered for it was called Advanced Entrepreneurial Finance. Now don’t get me wrong, I manage some pretty large accounts as part of my day job, and I’m the chief financial officer at home, but the thing that was psyching me out is, in my undergraduate work I took a class called “Math for Non-Math Majors.” A class with the word advanced in front of the word finance was daunting to me. Well, I’ve had a week to meditate on the syllabus, and I’m happy to report, I think I’ll be just fine. The syllabus calls this class “Entrepreneurial Funding” which seems less scary and there really isn’t anything too hard about the concept of money in and money out. The advanced concepts, as they relate to entrepreneurship seem really helpful and exciting. I’ll get to learn more about topics like:
- Updating a Chart of Accounts
- Managing Cash Flow
- Crowd Funding Strategies
- Valuing a Company
- Funding Sources
- & Harvesting-The End Game
To help inspire me, I’ve been googling entrepreneurial financial wisdom. Blogger Choncé Maddox came up with a great list of 5 Inspirational Money Quotes from Entrepreneurs on her blog Due.
So, I’m not nervous about the class anymore. All of these things make perfect conceptual sense, and as I learn more, I’m sure I’ll be even more jazzed about the prospect of helping my husband grow his business through what I learn. After all, I have two things going for me:
- I LOVE money.
- AND…unlike dogs, I have pockets.