don’t raise money until you have a real
business and you have some momentum
behind you otherwise you’re going to get
killed on your valuation and it’s going
to chew up all of your time not giving
you anything that to work with the build
your business hi I’m Evan Carmichael I
believe that hungry entrepreneurs
deserve help and today maintain a
question from one of my newsletter
readers Norman who wrote in the say good
afternoon mr. Carmichael my name is
Norman I’m a novice entrepreneur I’ve
been trying to get into entrepreneurship
for a little over three years now i
graduated college you want to start my
business I need five thousand dollars
for capital for software and coaching I
know it doesn’t seem a lot but I can’t
come across the money I was hoping you
give me some direction tips from in the
right direction hope to hear from you
soon Norman Norman raising capital sucks
ok it takes up a lot of your time it
doesn’t let you focus on your operations
and you get killed on the valuation now
first of all if you’re only raising
$5,000 really the people who should be
talking to our friends and family it’s
called love money you’re not going to go
out and get an investor to put 5k into
your business you may be able to
crowdsource fund it on sites like
Kickstarter but really at that low
amount you’re looking at friends and
family people who are in your network
you know even distant friends who you
haven’t connected with in a while can
often be great sources but I don’t think
you need the money you got to just start
up start with a service start talking to
customers get them to see the value that
you can provide and help you build a
business around their needs if you’ve
been wanting to start a business for
three years you got to just start it I
don’t want you to wait another three
years another three years and you end up
in some job you know stuck in corporate
life and you’re not you’re never able to
break free of it get started start small
start a service go talk to your
potential customers find out what they
need help with and build a product or
service around them you don’t need
software you don’t need coaching just
start talking to your customers here’s a
flip side okay if you say I really need
this money what’s going to happen you
need to spend a lot of time to go out
and talk to these potential investors
right if it’s your friends or family or
even if you try to get in
so is interested which is going to be
really hard for 5k you’re going to take
so much of your time doing this when
instead of pitching investors you could
be pitching customers next you don’t
even know if this ideas going to work or
not okay going to pitch investors with
just an idea rarely works they could put
money in and you could lose your shirt
and you’re going to lose their money and
imagine you borrowed money from your
uncle or your sister or whoever it is
some distant friend of yours it doesn’t
work out you’re going to feel pretty
guilty I don’t want that for you it’s
better to invest the time into
understanding your customers and seeing
what they want so that when you actually
go and raise money it’s to build it
around something that there’s a need for
people have said hey I really want this
help me and the third thing is you’re
going to get killed in your valuation if
you’re giving up equity in your business
they’re going to take a huge chunk
because it’s risky what are they buying
nothing I promise a dream when you go
out and raise money you want to do it on
the best terms possible and that’s going
to come after you have some momentum the
easiest type of money to raise and the
cheapest is expansion capital you’ve
shown that you can you can build
something up on your own you may not be
making huge money it’s not glamorous but
you’ve shown that people will pay you
for what you do once you’ve proven that
you’ve separated yourself from
ninety-nine point nine percent of all
the other businesses that investors will
see I used to be in the venture capital
game and most of the people who gave us
their business plan had nothing had an
idea and those guys are not the ones who
got funded the guys who got funded were
the ones who already had some momentum
they already had their product or
service bill they already had people
using it some people paying them they
had proof of concept they had momentum
and they needed money to expand that’s
where you want to get to it’s entirely
possible to bootstrap this up spend your
time talking to customers not even
selling them just getting to know them
getting to know their pain points
understanding how you can help them and
have your customers help finance the
start of your business if it’s around a
service it’s just your time you don’t
need anything you don’t need software
you don’t need consulting just get out
there and start talking to customers and
they’ll guide you along your path
good luck for those of you watching you
like this video please give it a thumbs
up below makes me want to do more for
you and hey do you have a comment about
this video I’d love to hear from you
leave it in the comment section below or
if you have a question about your
business I always read those I really
loved seeing the questions and comments
come in every morning so thank you guys
and I’ll see you on the next episode
business and you have some momentum
behind you otherwise you’re going to get
killed on your valuation and it’s going
to chew up all of your time not giving
you anything that to work with the build
your business hi I’m Evan Carmichael I
believe that hungry entrepreneurs
deserve help and today maintain a
question from one of my newsletter
readers Norman who wrote in the say good
afternoon mr. Carmichael my name is
Norman I’m a novice entrepreneur I’ve
been trying to get into entrepreneurship
for a little over three years now i
graduated college you want to start my
business I need five thousand dollars
for capital for software and coaching I
know it doesn’t seem a lot but I can’t
come across the money I was hoping you
give me some direction tips from in the
right direction hope to hear from you
soon Norman Norman raising capital sucks
ok it takes up a lot of your time it
doesn’t let you focus on your operations
and you get killed on the valuation now
first of all if you’re only raising
$5,000 really the people who should be
talking to our friends and family it’s
called love money you’re not going to go
out and get an investor to put 5k into
your business you may be able to
crowdsource fund it on sites like
Kickstarter but really at that low
amount you’re looking at friends and
family people who are in your network
you know even distant friends who you
haven’t connected with in a while can
often be great sources but I don’t think
you need the money you got to just start
up start with a service start talking to
customers get them to see the value that
you can provide and help you build a
business around their needs if you’ve
been wanting to start a business for
three years you got to just start it I
don’t want you to wait another three
years another three years and you end up
in some job you know stuck in corporate
life and you’re not you’re never able to
break free of it get started start small
start a service go talk to your
potential customers find out what they
need help with and build a product or
service around them you don’t need
software you don’t need coaching just
start talking to your customers here’s a
flip side okay if you say I really need
this money what’s going to happen you
need to spend a lot of time to go out
and talk to these potential investors
right if it’s your friends or family or
even if you try to get in
so is interested which is going to be
really hard for 5k you’re going to take
so much of your time doing this when
instead of pitching investors you could
be pitching customers next you don’t
even know if this ideas going to work or
not okay going to pitch investors with
just an idea rarely works they could put
money in and you could lose your shirt
and you’re going to lose their money and
imagine you borrowed money from your
uncle or your sister or whoever it is
some distant friend of yours it doesn’t
work out you’re going to feel pretty
guilty I don’t want that for you it’s
better to invest the time into
understanding your customers and seeing
what they want so that when you actually
go and raise money it’s to build it
around something that there’s a need for
people have said hey I really want this
help me and the third thing is you’re
going to get killed in your valuation if
you’re giving up equity in your business
they’re going to take a huge chunk
because it’s risky what are they buying
nothing I promise a dream when you go
out and raise money you want to do it on
the best terms possible and that’s going
to come after you have some momentum the
easiest type of money to raise and the
cheapest is expansion capital you’ve
shown that you can you can build
something up on your own you may not be
making huge money it’s not glamorous but
you’ve shown that people will pay you
for what you do once you’ve proven that
you’ve separated yourself from
ninety-nine point nine percent of all
the other businesses that investors will
see I used to be in the venture capital
game and most of the people who gave us
their business plan had nothing had an
idea and those guys are not the ones who
got funded the guys who got funded were
the ones who already had some momentum
they already had their product or
service bill they already had people
using it some people paying them they
had proof of concept they had momentum
and they needed money to expand that’s
where you want to get to it’s entirely
possible to bootstrap this up spend your
time talking to customers not even
selling them just getting to know them
getting to know their pain points
understanding how you can help them and
have your customers help finance the
start of your business if it’s around a
service it’s just your time you don’t
need anything you don’t need software
you don’t need consulting just get out
there and start talking to customers and
they’ll guide you along your path
good luck for those of you watching you
like this video please give it a thumbs
up below makes me want to do more for
you and hey do you have a comment about
this video I’d love to hear from you
leave it in the comment section below or
if you have a question about your
business I always read those I really
loved seeing the questions and comments
come in every morning so thank you guys
and I’ll see you on the next episode
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