Startups and businesses looking to grow are faced with scores of challenges in today's marketplace. Preparing for the future is the best way to ensure success. Know where you want to be. The first thing you need to know is where you want your business to be in 3, 5, or 10 years and what role you see yourself playing. Do you want to grow with the business and remain there as long as you can? Do you want to launch the business and exit? Sell? Remain on the Board? Build momentum slowly. Most small businesses collapse when operational growth outstrips revenue. Build your product or service and prove that it works before spending all your money on infrastructure. Get serious about revenue projections. Very few companies create a product that can grow sales at 20% per year. Look at the growth history and projections of businesses similar to yours. Understand the cost of operations. Many businesses look at the cost of building a product and pay little attention to the cost of running it. A product that costs $1.3M to build and sells for $125K might cost $1M annually to support. If the product brings in $800K a year and reoccurring support fees add on $150K, what's left? (50K)

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Have a valuation track record. Business conditions change frequently. So does the value of a business. Establish a method and frequency of valuation, and structure investment around it. This will keep you from losing control of the business if you seek investment in lean times.

Set stock aside. If you seek funding, be realistic about how much of your business you will have to give up. The riskier your business, the more you will have to give up to get funding.

If you want to be a member of the "A" team, act like a member of the "A" team. As businesses grow, many founders get pushed out and become resentful. If you want to remain with your business, manage it effectively, establish a board, establish subcommittees, and share all information. Most importantly, follow the board's recommendations even if they are a bitter pill. Nothing shows leadership like taking others' counsel.

Don't take perks out of the company too early. Investors these days want to see hard work and reinvestment in a business before they provide funding. Keep your books straight, don't mix personal and corporate expense accounts, and don't take perks if you are planning to look for investment.

Articulate the value. Make sure you can articulate the value of your product to its target customer. Features don't sell products, value does - know the ROI!

Know your competition. Know your competitor better than you know yourself. When asked who your competitors are, know the majority of them, what services they provide, and if they are direct or indirect.

Validate, validate, validate. Customer validation is the only thing that counts. Just because there are three other players in your market segment does not make your product a guaranteed success.

Manage your finances like a pro. Have a plan and a budget, and manage your fundraising process carefully. Financial details count when looking for investment. Be responsive and hit your milestones.

Establish relationships early. If you are seeking to get VC or Angel funding, establish your relationship before you need the funding. Ask a member of the VC group to sit on your board. Follow his or her counsel.

Things take time. Developing a product or service does not happen overnight and, as mentioned before, customer validation is important. Develop a specification and a plan that are flexible enough to guide you but still allow you to deliver enough value to your first customer.

If you build it ... Will they pay for it?

Specifics for VC Funding

Build a quality team. VC's want to invest in people as well as your product. Assemble a quality team of professionals who have successful track records in your industry.

Return on investment. VC's are mostly interested in products that can pay a 30% dividend. They are looking for fast turns, like under 2 years investment to payoff.

Leverage on equity. The investment should directly result in sales.

Rounds. The initial investment should fund operations.

Do your homework. Know what types of projects VC's will invest in. Don't waste the time of VC's that don't fund in your market segment.

Look around. Use statistics from similar businesses in the marketplace to assist in creating realistic financials.

Defend your position. Be able to back up your assumptions -- all of them.

Have the numbers. Have metrics that demonstrate value to the customer.

Know the impact. Know what impact the exit of any investor will have on options held by employees or common shares, and be prepared for the exit to be stated at the funding table.

Don't be too needy. Don't go up against an industry giant unless you have enough validation and support to overtake them. Remember, the higher the risk, the bigger the stake the VC will want.

Interview the VC. Know before you schedule an afternoon that the VC you are going to see is still funding projects in your vertical. How many have they funded in the past year? When was their last deal?

Support the State. Some State programs fund only 5% of what gets presented to them. However, there are many State and Federal programs out there. Don't bad mouth a program if it didn't fund you. It's a small world and people talk.

From A Legal Perspective

Have your house in order. As stated before, have your business operations polished and ready for inspection.

Have your books straight. The state of finances speaks volumes about the leadership of a company no matter the size.

Be credible. Make sure you are honest in your dealings and that your integrity speaks for itself. The business world is a small place.

Be prepared for change. When a company brings in outside funding, things change. Be prepared to take the counsel of others and have your business ready for inspection.

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About Sales Focus Inc. Sales Focus Inc. is a consulting, training and outsourcing company that focuses strictly on sales. We help our clients during these difficult times to take business away from the competition. In down economic times, focused companies will not only survive, but also thrive! We offer cost containment and profit enhancement solutions. Profit enhancement is a different mindset than cost cutting. Cost cutting means doing less of something; profit enhancement implies doing more of something that will boost the bottom line. We represent the concept of focused profit enhancement solutions.

Sales Focus is driven towards a single goal: "Generating Immediate Revenue for our Clients! " Whether it's implementing our S.O.L.D. Methodology, Developing Specialized Training Programs or Launching an Outsourced Sales Force, we remain focused on the goal of TACTICALLY GENERATING RAPID REVENUE.

For more Information or to see if we are a good fit with your company, contact us directly at 866.840.8305 or 410.442.5600, or send us an email at info@SalesFocusInc.com or visit our web site: www.SalesFocusInc.com. Learn about a few of our numerous sales success case studies, some of the many clients we help, and request a free white paper while calling us or visiting our website.

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