Are You Ready for Global Entrepreneurship Week?
In case you didn’t know it, it’s Global Entrepreneurship Week…a chance to celebrate and learn about new business and business growth.
Question: What does a “lighting company”, a “pet focused drug company”, and a “large double-hooked plastic handle” all have in common?
Answer: They are all successful businesses started by Kansas City based entrepreneurs. The first is a small service business, the second a biopharmaceutical company, and the third an innovative product manufactured in the USA; each uniquely different from the other, all of them started by Kansas City entrepreneurs.
Why should you care?
Last week the ACA club in Kansas City held a panel discussion. The topic was “Funding Options for Entrepreneurs”. The panel was comprised of 2 bank executives and an angel investor. It was a great introduction for this week’s 2013 installment of Global Entrepreneurship Week, which this year is expected to include approx. 35,000 events happening simultaneously in 125 different counties.
With new businesses funding is often an issue. Even if one personally has the financial capital to fund the venture, you can usually go farther and faster if you have access to more money. That said, however…money doesn’t grow on trees and there are some things you have to think about if you’d like to get more funding.
Without getting into too many specifics these are a few of the highlights worth noting if you are looking for success in seeking funding:
- Do you have a vision for your company?
- Have you created a business plan?
- Is your business scalable for growth?
- Lenders/Investors look for passion. They want to know the borrowers are all in.
- Lenders are going to want between 10-25% investment (skin in the game) by the borrower.
- Is your idea or product unique? Does it have a market? Have you tested it?
- Both SBA Loans and conventional loans have their place.
- Know your options; taking on debt is almost always better than giving up equity.
Back to the Question…
The other common thread of the three businesses in the initial question was that each panel member was asked to share an example of one business that stood out in recent memory that they wanted to share as a success story. The answers were not over thought, just pure off the cuff responses of companies that had been memorable for them. What was interesting is that the business each panelist referenced was completely different, but from a collective viewpoint they represented a large cross sectional slice of businesses in our economy. Think about it, which one do you most identify with?
So what made them notable?
The Service Business….The small lighting company took out an SBA loan to fund a plan a growth. It has resulted in an increase of sales from $100,000 to $300,000; a 200% increase! They have a plan and they are executing it. What 200% growth looks like will vary, with this company, in addition to more customers; it meant adding a 2nd service vehicle. And of course…their future looks “bright”! 😉
The biopharmaceutical company…In 2010 the founder created this company with a goal to become a leading provider of therapeutics developed and approved specifically for use in pets, by using compounds already licensed for humans. Think of it as repurposing drugs. In just 3 years they have went from ZERO to the NASDAQ. This past June Aratana Therapeutics, Inc. had their IPO and PETX now trades around $20/share after an initial offering at $6.
The invention, the double hooked handle was created through some out of the box thinking, or more appropriately “out of the bag” thinking. After tweaking a prototype for several years, it’s inventor placed a model to his banker’s desk explaining the problem and how his invention was going to solve it. The problem was a challenge we are all familiar with; not having enough fingers and hands to carrying multiple plastic grocery/shopping bags at the same time. Today you can find the Mighty Handle in stores not only across the metro but around the country. Best of all it is made in the USA!
OK…Now it’s Your Turn!
This week we encourage you to get out and take in at least one or two of the activities going on around the Metro or wherever you live. KC Source Link has an excellent listing of the events. Almost all of them are free so get out and make the most of it! You never know what you might learn. As always please feel free to add any thoughts you have in the space below.
Chris Steinlage Kansas City Business Coach