hi I’m Evan Carmichael welcome to
another edition of ask Evan now last
month I put out a call on YouTube asking
for questions from readers that we’re
gonna answer on this channel for our
video here in December and we got so
many questions I’m gonna pick the top
three that I really liked and we’re
gonna answer them now here today and
then I’m gonna be answering more as part
of our challenge Series in 2013 so three
of the questions that I got asked I’m
gonna pull them up here and got my
Samsung Galaxy Note 2 that I’ve got some
questions on so the first one is from
one of our YouTube viewers when were you
the happiest thanks for you inspirations
don’t stop making videos I’ll keep
making these videos as long as you guys
keep watching the videos in terms of
what makes me happiest I’m happiest when
I’m helping entrepreneurs and that may
sound really cheesy or corny but that
that’s what that’s what drives me I love
helping entrepreneurs and I think a big
problem is a lot of entrepreneurs don’t
start asking for help until it’s almost
too late
you know they’ve tried everything on
their own they’re at their wit’s end
they’re frustrated exasperated out of
money and don’t know what to do next you
know thinking about quitting giving up
and they come to me and they ask you
their questions as kind of a last resort
and I’m able to help them and seeing
their eyes light up that a you know
somebody believes in you and thinks you
can accomplish it and also has given you
some practical suggestions and advice to
help you grow your business that’s
awesome
like seeing somebody light up like that
makes my day I wish I could do it all
day long I try to do it as much as I can
as part of my business and so whether
it’s you know face to face or trying to
make videos like this for you guys or
over the phone or at a conference or
speaking event I love helping
entrepreneurs and try to incorporate
that as much as I can again into my day
to day life so we you know whatever it
is for you you want to find that passion
unfortunately I found that relatively
early on and I can try to live that and
do that everyday and hopefully some of
the excitement and passions coming
through in this videos I’m talking to
you but that’s what really drives me and
that’s that’s when I’m happiest so
hopefully you find that happening
for your business as well so thanks for
that question flushing number one okay
so we’re gonna turn the question number
two now comes from one of our readers
skip
so skip wrote in say my main question is
getting seed or startup cash whether I
sell shares of my company to people I
know or go to a VC who might be able to
help my business along because of their
expertise connections etc thanks for the
question skip very common question for
entrepreneurs who are starting up trying
to get the money to grow their company
the first thing I would think about is
do you really really really absolutely
need the money to start this business
the couple reasons why I ask that the
first is raising capital almost becomes
a full-time job for your company so what
it does is take away your time to focus
on actually building up your company so
if you’re out spending all this time
meeting VCS and meeting you know
individual investors friends family
angels whatever it is that’s time that
you’re not being you know I’m not
putting into actually growing your
business so do you absolutely need that
money to get going or is there a way
that you can bootstrap it up at least
get their certain point and then look at
raising capital should be easier the
second component to that is it’s you’re
gonna get killed in your valuation the
valuation on the startup is way way way
worse than if you have even one customer
a little bit of money coming into your
company when I was in the VC business we
got tons and tons and tons of proposals
and most of them were just an idea and
it’s really hard for you to stand out
against everybody else that the fear is
that you’re not gonna be able to make it
anybody can spend money right if I gave
you I don’t know what you’re looking for
or five hundred thousand dollars a
million dollars if I gave that to you
you could spend it right anybody can
spend it it’s hard to make the money and
it’s hard for you to stand out from
everybody else who’s promising the same
thing as you are so if you’re able to
build up your business at least a
certain point I’m not gonna expect you
to build a gigantic business all on your
own bootstrapping it up but if you can
get some customers and find ways to save
cost and grow a little bit of a business
and get some momentum going behind you
then when you go to investors where
those VCS or friends and family or
angels
it’ll a be much easier to get them to
say yes because the easiest money to
raises expansion capital instead of
startup capital but also you get a much
better valuation so you’re not giving up
as much of the business
you would if you need that money all
upfront so something to think about if
you really really need that money or not
I’d really encourage you to try to
bootstrap it up as much as you can
before going for investment if you have
to go for investment the next thing
guard look at if you’re comparing
friends and family and angels to VCS the
first is how much of an active role do
you want somebody to play in your
business so obviously if you’re going
with a VC partner you want somebody who
can bring connections and you know
contacts and partnerships and media and
customers to your business it’s ideally
much better than somebody who’s just
giving you money the the range will
depend on how much money you need to
grow your business right if you need
$100,000 for your company you’re not
really going to be able to attract a
venture capital investor to come on for
that it’s not it’s too low you’re
looking at a friends and family or
angels so I don’t know how much you need
and if you’re looking for half a million
or a million dollars then you’re playing
in BC territory and you know unless you
have really really wealthy friends they
probably won’t be able to afford a half
a million or a million dollar price tag
so right away depending on how much
money you need that’s gonna depend on
you know who you end up going after then
you want to think about how much you get
involvement you want them to have in
your business so if you’re going for
friends and family you know it’s all
great when the business is going well
but business doesn’t always go super
well right so if you have Uncle Joe
putting money into your company and it’s
not going well for him then it’s not
gonna make Thanksgiving dinner really
uncomfortable because Uncle Joe you know
was losing money on your business or
maybe he wants to really be involved in
your company but doesn’t have any skill
sets that could you know you could
really use so you know do you want to
have him as part of your management team
or not some questions that you want to
ask yourself but definitely you want
ideally if you are going for an investor
somebody who can bring on more than just
money and can bring on connections and
experience and can complement some of
the weaknesses that you might have as an
entrepreneur one last tip about raising
capital if you know you need a certain
amount to say you need half a million
dollars your company I try to phase it
out so instead of saying half a million
dollars right now I try to phase it out
with milestones so say you need a
hundred thousand dollars now and then in
three months another two
and three months for the 200,000 you can
go to an investor and say this is how
much I need and this is what I’m gonna
need it phase out over a period of time
and if we hit certain milestones it
could be revenue targets a number of
customers or whatever it is that makes
sense for the business then you can ask
for better valuation so instead of
giving up a big chunkier company for
that half a million dollars now you can
give up you know only a little bit at
that hundred thousand dollars startup
and then in three months you’ve hit your
milestones you get another 200k at a
better evaluation and another few months
you get the final 200k and an even
better valuation because you’ve hit your
milestones and have shown your investor
that you’re not just gonna be every
other startup that fizzles out so you’re
reducing the risk for the investor and
you’re also giving yourself a better
valuation and you’re betting on yourself
you’re saying yeah I’m gonna be able to
hit these targets and so by doing that
you’re gonna get a much better price for
your company so a couple things to keep
in mind skip good luck with the business
and if you have other questions let me
know on to question number three
all right so question number three comes
from another one of our readers neo
cobby so he wrote in I have a question
I’m working for two companies I’m doing
a beauty salon and part-time marketing
at an events company in both companies I
am responsible for attracting new
clients to the business what is the best
and most efficient way to do this and
make it cost-effective so thank you for
the question another great question you
know as entrepreneurs we don’t have a
lot of money to invest into our our
efforts so we want to make sure that the
money we’re putting in is being spent as
wisely as possible and I hate spending
money until I’m making money and if
there was a rule for entrepreneurship
that would be one of them is don’t spend
until you earn so I try to bootstrap it
I put them in your time but not start
spending a lot of money until you find a
way to make money and if you can do that
on a small scale then you invest your
money into making it more successful for
attracting new clients my favorite way
to do it is through partnerships so
going out and cold calling and doing
advertising and
you know calling on people going to
events can be a very time-consuming
process very expensive very slow and you
have to go through the process of
educating customers on why they should
come to you where if you’re going
through a partner it’s super fast and
can be very cost effective because
you’re basically finding people who are
already selling to your target market
so you find somebody who’s selling to
your ideal client and you strike up a
partnership or in agreement with them so
that can range from giving them a cut of
the sales or just you know something as
goodwill giving them an option for their
clients or you’re gonna be referring
business back to them as well you
basically I look at who are people who
are also selling to your target market
and ideally what you look at is not
direct competitors because why would
they refer customers to you but you’re
looking at people who where are they
buying before they buy from you
so this events management company who
are they buying from before they come to
you
maybe it’s an event planner so then you
want to partner up with event planners
alright so think through that buying
process where are they buying from
before they end up coming to you and
start talking to those people and check
up partnership agreements with them so
they already have your target market
they’re there selling to them they have
a relationship with them and so when
they say you got to work with this
company there’s an incentive to want to
do it because they’ve been referred in
and referred clients ask us questions
I’m more qualified buy more are more
loyal stay with you longer spend more
money it’s the best have a client to get
so you want to start making those
partnerships with similar companies who
can you know be very synergistic with
the same types of clients that you have
so that would be my number one tip on
the marketing side in terms of being
something cost-effective and also being
fast to get the market hopefully that
helps thank you guys for joining us for
another video we’re gonna have a lot
more coming in 2013 if you like the
video please give it a thumbs up below I
love seeing those come out and if you
have a comment or question feel free to
leave it below in the comment section I
always read those I love seeing them and
I always apply as
fast as I can not always immediate but
as fast as I can so thank you have a
great end to the year and we’ll see you
in 2013
you
another edition of ask Evan now last
month I put out a call on YouTube asking
for questions from readers that we’re
gonna answer on this channel for our
video here in December and we got so
many questions I’m gonna pick the top
three that I really liked and we’re
gonna answer them now here today and
then I’m gonna be answering more as part
of our challenge Series in 2013 so three
of the questions that I got asked I’m
gonna pull them up here and got my
Samsung Galaxy Note 2 that I’ve got some
questions on so the first one is from
one of our YouTube viewers when were you
the happiest thanks for you inspirations
don’t stop making videos I’ll keep
making these videos as long as you guys
keep watching the videos in terms of
what makes me happiest I’m happiest when
I’m helping entrepreneurs and that may
sound really cheesy or corny but that
that’s what that’s what drives me I love
helping entrepreneurs and I think a big
problem is a lot of entrepreneurs don’t
start asking for help until it’s almost
too late
you know they’ve tried everything on
their own they’re at their wit’s end
they’re frustrated exasperated out of
money and don’t know what to do next you
know thinking about quitting giving up
and they come to me and they ask you
their questions as kind of a last resort
and I’m able to help them and seeing
their eyes light up that a you know
somebody believes in you and thinks you
can accomplish it and also has given you
some practical suggestions and advice to
help you grow your business that’s
awesome
like seeing somebody light up like that
makes my day I wish I could do it all
day long I try to do it as much as I can
as part of my business and so whether
it’s you know face to face or trying to
make videos like this for you guys or
over the phone or at a conference or
speaking event I love helping
entrepreneurs and try to incorporate
that as much as I can again into my day
to day life so we you know whatever it
is for you you want to find that passion
unfortunately I found that relatively
early on and I can try to live that and
do that everyday and hopefully some of
the excitement and passions coming
through in this videos I’m talking to
you but that’s what really drives me and
that’s that’s when I’m happiest so
hopefully you find that happening
for your business as well so thanks for
that question flushing number one okay
so we’re gonna turn the question number
two now comes from one of our readers
skip
so skip wrote in say my main question is
getting seed or startup cash whether I
sell shares of my company to people I
know or go to a VC who might be able to
help my business along because of their
expertise connections etc thanks for the
question skip very common question for
entrepreneurs who are starting up trying
to get the money to grow their company
the first thing I would think about is
do you really really really absolutely
need the money to start this business
the couple reasons why I ask that the
first is raising capital almost becomes
a full-time job for your company so what
it does is take away your time to focus
on actually building up your company so
if you’re out spending all this time
meeting VCS and meeting you know
individual investors friends family
angels whatever it is that’s time that
you’re not being you know I’m not
putting into actually growing your
business so do you absolutely need that
money to get going or is there a way
that you can bootstrap it up at least
get their certain point and then look at
raising capital should be easier the
second component to that is it’s you’re
gonna get killed in your valuation the
valuation on the startup is way way way
worse than if you have even one customer
a little bit of money coming into your
company when I was in the VC business we
got tons and tons and tons of proposals
and most of them were just an idea and
it’s really hard for you to stand out
against everybody else that the fear is
that you’re not gonna be able to make it
anybody can spend money right if I gave
you I don’t know what you’re looking for
or five hundred thousand dollars a
million dollars if I gave that to you
you could spend it right anybody can
spend it it’s hard to make the money and
it’s hard for you to stand out from
everybody else who’s promising the same
thing as you are so if you’re able to
build up your business at least a
certain point I’m not gonna expect you
to build a gigantic business all on your
own bootstrapping it up but if you can
get some customers and find ways to save
cost and grow a little bit of a business
and get some momentum going behind you
then when you go to investors where
those VCS or friends and family or
angels
it’ll a be much easier to get them to
say yes because the easiest money to
raises expansion capital instead of
startup capital but also you get a much
better valuation so you’re not giving up
as much of the business
you would if you need that money all
upfront so something to think about if
you really really need that money or not
I’d really encourage you to try to
bootstrap it up as much as you can
before going for investment if you have
to go for investment the next thing
guard look at if you’re comparing
friends and family and angels to VCS the
first is how much of an active role do
you want somebody to play in your
business so obviously if you’re going
with a VC partner you want somebody who
can bring connections and you know
contacts and partnerships and media and
customers to your business it’s ideally
much better than somebody who’s just
giving you money the the range will
depend on how much money you need to
grow your business right if you need
$100,000 for your company you’re not
really going to be able to attract a
venture capital investor to come on for
that it’s not it’s too low you’re
looking at a friends and family or
angels so I don’t know how much you need
and if you’re looking for half a million
or a million dollars then you’re playing
in BC territory and you know unless you
have really really wealthy friends they
probably won’t be able to afford a half
a million or a million dollar price tag
so right away depending on how much
money you need that’s gonna depend on
you know who you end up going after then
you want to think about how much you get
involvement you want them to have in
your business so if you’re going for
friends and family you know it’s all
great when the business is going well
but business doesn’t always go super
well right so if you have Uncle Joe
putting money into your company and it’s
not going well for him then it’s not
gonna make Thanksgiving dinner really
uncomfortable because Uncle Joe you know
was losing money on your business or
maybe he wants to really be involved in
your company but doesn’t have any skill
sets that could you know you could
really use so you know do you want to
have him as part of your management team
or not some questions that you want to
ask yourself but definitely you want
ideally if you are going for an investor
somebody who can bring on more than just
money and can bring on connections and
experience and can complement some of
the weaknesses that you might have as an
entrepreneur one last tip about raising
capital if you know you need a certain
amount to say you need half a million
dollars your company I try to phase it
out so instead of saying half a million
dollars right now I try to phase it out
with milestones so say you need a
hundred thousand dollars now and then in
three months another two
and three months for the 200,000 you can
go to an investor and say this is how
much I need and this is what I’m gonna
need it phase out over a period of time
and if we hit certain milestones it
could be revenue targets a number of
customers or whatever it is that makes
sense for the business then you can ask
for better valuation so instead of
giving up a big chunkier company for
that half a million dollars now you can
give up you know only a little bit at
that hundred thousand dollars startup
and then in three months you’ve hit your
milestones you get another 200k at a
better evaluation and another few months
you get the final 200k and an even
better valuation because you’ve hit your
milestones and have shown your investor
that you’re not just gonna be every
other startup that fizzles out so you’re
reducing the risk for the investor and
you’re also giving yourself a better
valuation and you’re betting on yourself
you’re saying yeah I’m gonna be able to
hit these targets and so by doing that
you’re gonna get a much better price for
your company so a couple things to keep
in mind skip good luck with the business
and if you have other questions let me
know on to question number three
all right so question number three comes
from another one of our readers neo
cobby so he wrote in I have a question
I’m working for two companies I’m doing
a beauty salon and part-time marketing
at an events company in both companies I
am responsible for attracting new
clients to the business what is the best
and most efficient way to do this and
make it cost-effective so thank you for
the question another great question you
know as entrepreneurs we don’t have a
lot of money to invest into our our
efforts so we want to make sure that the
money we’re putting in is being spent as
wisely as possible and I hate spending
money until I’m making money and if
there was a rule for entrepreneurship
that would be one of them is don’t spend
until you earn so I try to bootstrap it
I put them in your time but not start
spending a lot of money until you find a
way to make money and if you can do that
on a small scale then you invest your
money into making it more successful for
attracting new clients my favorite way
to do it is through partnerships so
going out and cold calling and doing
advertising and
you know calling on people going to
events can be a very time-consuming
process very expensive very slow and you
have to go through the process of
educating customers on why they should
come to you where if you’re going
through a partner it’s super fast and
can be very cost effective because
you’re basically finding people who are
already selling to your target market
so you find somebody who’s selling to
your ideal client and you strike up a
partnership or in agreement with them so
that can range from giving them a cut of
the sales or just you know something as
goodwill giving them an option for their
clients or you’re gonna be referring
business back to them as well you
basically I look at who are people who
are also selling to your target market
and ideally what you look at is not
direct competitors because why would
they refer customers to you but you’re
looking at people who where are they
buying before they buy from you
so this events management company who
are they buying from before they come to
you
maybe it’s an event planner so then you
want to partner up with event planners
alright so think through that buying
process where are they buying from
before they end up coming to you and
start talking to those people and check
up partnership agreements with them so
they already have your target market
they’re there selling to them they have
a relationship with them and so when
they say you got to work with this
company there’s an incentive to want to
do it because they’ve been referred in
and referred clients ask us questions
I’m more qualified buy more are more
loyal stay with you longer spend more
money it’s the best have a client to get
so you want to start making those
partnerships with similar companies who
can you know be very synergistic with
the same types of clients that you have
so that would be my number one tip on
the marketing side in terms of being
something cost-effective and also being
fast to get the market hopefully that
helps thank you guys for joining us for
another video we’re gonna have a lot
more coming in 2013 if you like the
video please give it a thumbs up below I
love seeing those come out and if you
have a comment or question feel free to
leave it below in the comment section I
always read those I love seeing them and
I always apply as
fast as I can not always immediate but
as fast as I can so thank you have a
great end to the year and we’ll see you
in 2013
you
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