Financing your startup: what are your options?

small business financing canadaBack in the bad old days, financing a startup meant you were looking at some slim pickings for a source of funding: a traditional bank, your savings account, a wealthy benefactor in your corner, or if you were really lucky, perhaps your parents’ savings account.

The modern financing world for startups looks like the Wild West, comparatively speaking.

As dynamic and diffuse as financing has become, you still need to know the ins and outs of all of the options you have in front of you.

That’s why My StartUp is dedicating the month of October to a variety of financing possibilities to help you broaden your horizons. Although your stodgy neighbourhood banker may not have much time for your financing needs, the good news is that the new economy is a startup’s best friend when it comes to financing options.

No two startups are alike, so your approach to financing should account for your unique situation. Let’s give our October theme an early start by generating some questions that will help frame the issue and focus your financing mindset:

  • How long have you been in business?
  • How far along are you with your business model?
  • How important is cash flow right now?
  • Have you built up a substantial user base?
  • Have you gone through a scalability exercise?
  • Are you willing to part with equity in your startup in exchange for funding?
  • Have you pitched for funding previously?
  • What are your specific expectations for fundraising?
  • Is this a need or a want (i.e., are you sure this is the right time to seek additional financing)?

We’ll open the month with a look at crowd-funding, including a breakdown of options for Canadian startups, current trends, regulations, and a few pointers that may lead you towards a successful crowd-funding outcome.

My StartUp will also delve into angel investing: how important this funding stream has become for start-ups and details on where angel investors can connect with entrepreneurs. There may be a wealthy individual out there willing to contribute capital to your startup in exchange for equity or convertible debt. Depending on the stage of growth of your startup, angel investors might be the way to go.

What about some tried and true approaches to startup financing? There are always non-traditional banking sources of funding, such as the Business Development Bank of Canada. Some traditional banks, while usually risk averse and conservative, have opened specific lending arms focused on small businesses. Other banking institutions, especially credit unions, have initiated micro-financing. Futurpreneur is one of the better-known Canadian organizations providing funding for start-ups, and they will outline what entrepreneurs should keep in mind as they prepare a request for funding from a non-traditional source of financing.

Finally, My StartUp will round out the month with a feature showcasing Enterprise Toronto’s Starter Company, which is a city-backed venture that connects entrepreneurs with funding and resources.

If obtaining a source of financing for your startup is something you’ve been thinking about, be sure to visit My StartUp throughout October for a valuable cross-section of the various funding options at your disposal.

 


Attention Social Entrepreneurs: Socialight Vancouver, September 26th and 27th!

Socialight Vancouver Conference

If you’re a new or even aspiring entrepreneur in the Vancouver area, you might be interested in 600 of your peers at the Socialight conference this weekend at the Pan Pacific Hotel.

“Canada’s Ultimate Entrepreneurship & Leadership Event”, September 26th and 27th,

Is hosted by Riaz Meghji, Breakfast Television & Founder of Every Conversation Counts, and will feature a great line up of speakers, including:

Jack Lee – Founder, T&T Super Market

Farhan Mohamed  – Founder & Partner, Vancity Buzz

Dan Lok – Serial entrepreneur and millionaire mentor

Vicki Saunders – Founder, SHeEO

Ray Walia – Co – Founder and CEO, Launch Academy – Top 40 Under 40

Steve Curtis, Founder – Zag Group Inc.

Melissa Orozco – Social entrepreneur and Co-Founder, Yulu PR

Jairek Robbins – #1 Amazon Best Selling Author, Entrepreneur and Coach

To learn more about the Socialight Conference, go to  www.socialightconference.com/Vancouver

 


The efficient entrepreneur: tips and tricks for your home-based small business

Over the month of September, we’ve taken a closer look at aspects of managing a home-based business that help give your small business the look and feel of a Fortune 500 company: work-life balance, virtual offices, and cloud computing, to name a few. The idea is to present your start-up like a million bucks while not breaking the bank.

Today’s offering looks at efficiency, with a few tips and tricks that can save you time, stress, and headaches as you grow your business.

In no particular order, here are seven cost-effective ideas to keep in mind each and every day to make your home-based operation an efficient entrepreneurial machine.

time-money1.  Time is money…

Ensure you are keeping regular business hours at home. You can sleep in and skip the commute, but set a pattern so that you remain focused and ready to engage the tasks ahead of you. If prospective clients are filling up your inbox at 9 a.m. and you are still snoozing, that’s one less opportunity for you to strike while the iron is hot. The early bird often gets the worm, so be sure your home schedule approximates the same one in the outside business world.

2.  …and space is wealth

The psychological effect of clutter can be profound. Take a few moments either at the beginning or end of your work day to organize your working space. It might seem like an insignificant detail, but a messy desk can often reflect a messy mind. This is not a hard and fast rule, because we all know successful business owners whose desktop is more of a rumour than a reality, yet for many people, the aesthetics of clutter can be a demoralizing distraction. In the same vein, always afford yourself a dedicated space in which to do your business (making phone calls, writing pitches, crunching numbers, etc.).  This means you might consider calling the in-laws or a sitter to watch the kids, or simply close the door to your home office so the dog isn’t constantly looking deep into your eyes for a treat.

3.  Dress the part

As tempting as it might be to sit in your pyjamas and bathrobe all day, this can put a dent in your productivity. Simply put, you really need to show up prepared to throw yourself into your work, because entrepreneurship is hard work that requires diligence and focus. A business owner who is dressed for success every morning, regardless of the environment, is ready to tackle the day and can jump into action for external meetings and events. Plus you’ll just plain feel good.

4.  There’s definitely an app for that

ss_computer_vector_113075257_jpgMany entrepreneurs are wisely benefitting from the best of the new economy, using apps to simplify and organize their affairs. Even emails are slowly becoming your dad’s way to get a message across. This speaks to the reality that there truly is an app for everything: grocery shopping, assigning work tasks to freelancers, banking, document sharing … the list of possibilities for applications that could help your home-based business is endless:

5.  Take care of you, too

Not everyone can work 18 hours a day, 7 days a week, without taking a break. In fact, those who do are headed straight for a burnout. While you go about managing the day-to-day operations of your business, it’s crucial to take a few moments each day to decompress, get some air, let your body loosen up, and free your mind of work. Your health is ultimately your wealth, because without it, your small business is standing still. Don’t forget to take care of yourself with proper snacks, nourishing meals, and enough breathing room to keep your body fueled and sharp. And if you are feeling a bit overwhelmed on a given day, remember: you have roughly two hours of bonus time each day because you aren’t commuting. You can use this time to meditate, jog, or simply listen to some music that gets you in the mood to execute. The extra time is a gift; use it wisely.

6.  Do you even do a to-do list, bro?

ss_papers_110023949-3This is an oldie but a goodie. As much as your apps can help free up some time in a busy life, a simple, old-fashioned list of things to do can really focus the mind and allow you to achieve some meaningful, measureable results every day. A good tactic is to over-promise and under-deliver to yourself: create a list with a reasonable number of deliverables (say six or seven) and go hard to ensure at least half of your list of to-do items is scratched off by the end of the day. It may seem archaic to make a physical list of action items, but the very act of committing these outcomes to paper will push you closer in the direction of completion. A bunch of action items floating around your head is no way to approach your daily priorities. Take a few moments to frame your priorities and then give them weight by writing them down.

7.  Piranha productivity: small bites consume a large whole

Have you ever set out to clean and organize your closet, but once you opened the door and absorbed the reality of the massively oppressive mess in front of you, you simply got turned off and walked away? A similar thing will happen if you approach your workload as one indistinguishable whole: it will appear overwhelming. Following hard on the heels of creating a to-do list, this tactic will help get you through big projects. Break down the deliverables into many bite-size pieces and approach them one at a time. The constituent parts of the whole are as great and as important as the whole, and when they are broken down into smaller chunks, the weight of the total is much easier to contemplate. This tactic is a great starting point when you are working on a business proposal or a workflow outline: find your broad macro categories first and develop a simple, big-picture overview of what you plan on including. It almost becomes a game of fill-in-the-blanks once you have a basic structure in place, and the ideas will flow into one another. You can fight the curse of a blinking cursor on an empty page a lot easier by breaking things down into digestible parts.


Tip the scales in favour of work-life balance from your home office

A word of advice from home-based entrepreneur Victor Ng

Scale2Ask anyone who has made the transition from a traditional office to a home-based or virtual office: working from your home office while maintaining a work-life balance can present challenges.

Sometimes, too much flexibility in your work schedule can throw off your balance.

The most successful people who work in home offices, whether they’re entrepreneurs or employees, always know how to prioritize their tasks and minimize distractions. For those working from home, their personal life can be easily mixed with their professional life. A person with a flexible schedule might start work early, run some errands at noon, meet friends for lunch, and then work until late at night. If your schedule is not planned carefully or you lack discipline, you may end up favouring one side.

Victor Ng, president and CEO of Exocloud, understands first-hand the challenges of creating a work-life balance while maintaining a home-based office. Victor has been working from home since 1997 when he founded his first company, Amplus Innovations Inc.

He believes that you need an above-average, self-disciplined mindset and time management skills to set a reasonable and achievable schedule that covers both your working life and your personal life. Before opting to work from home, Ng advises business owners to carefully consider several key factors.

  • Make sure there are minimal distractions in the home environment.
  • Make room for an exclusive space for work.
  • If you are unable to find space for a full office, set aside a section or a table in your home that’s dedicated to work only.

Ng and his team use many software applications and cloud technology to collaborate with others, share data files, keep track of schedules, contacts, emails, manage customer services and relationships, and perform online meetings.

There are other aspects of running a home-based business to consider.  For example, most home offices have limited facilities and space. It may not be easy to expand the business operation and the size of the team. Also, not everybody can work efficiently in a virtual office environment, and this may make it challenging to recruit new team members. It is important to consider whether a home office environment is the right fit for your business operation in the context of possible future expansion.

Generally speaking, Ng recommends a home office, especially for startup entrepreneurs, depending on the industry and business. A few additional questions worth asking:

  • Do you or your team deal with highly confidential or sensitive information and data?
  • Do you work with a team that requires little to no supervision?

As Internet infrastructure and cloud technology boom and improve, Ng believes that more and more people will be able to work at home, saving time, energy and commuting costs. With the convenience of technology, cloud computing, proper set up and a mindset change, there will be little difference between working in a ‘real’ office and working from home.


ExoCloudLogoVictor Ng is the President and CEO of Amplus Innovations, the creators of EXOCLOUD. With nearly 20 years of IT management and consulting services across the GTA, Amplus helps small- and medium-sized businesses, start-up companies and individuals looking for an effective way to create a competitive edge. With vision, passion and true belief in extraordinary customer experience, Amplus brings your business to new heights through its latest cloud-based solutions – EXOCLOUD. EXOCLOUD technologies improve IT efficiency, flexibility, security and scalability for future growth without high hardware, software and maintenance costs.

Website: www.exocloud.ca

Twitter: https://twitter.com/MyExoCloud

Linkedin: https://www.linkedin.com/company/exocloud

Facebook: https://www.facebook.com/pages/ExoCloud/876137572461200?ref=hl


Give your basement business a Bay Street feel

We live in a wonderful time for startup businesses. Whereas there was a time not so long ago when starting your own business meant needing cash on hand for rent, furniture, servers and office staff, today, just an idea will do.

ss_ideas_218961511_jpgAn idea and some creative packaging, that is.

Technology has made it possible for any business to have a professional website, including e-commerce, for very little up-front cost. Even if you require more than just a website, cloud computing lets you have the technological capacity of a large firm for, again, a very small financial investment.

In the age of social media, SEO and LOL, your business is going to need a physical presence. If your marketing does the trick, potential customers are going to call, wanting more information. Depending on the type of business and the price point of the products or services you sell, some customers may want to meet in person, and if not, partners certainly will.

shutterstock_179840120_jpgA virtual office offers your business the image of a much larger company – professional, credible, reliable – at a fraction of the cost.

Today’s virtual office providers offer a number of options that can give you all the presence your business needs. If you need a full-time office space but can’t afford a receptionist, most virtual offices can provide you an office within a shared space, use of a common receptionist both for phone contacts and visitors, and access to various boardrooms if you need space for larger meetings or presentations. Plus they can give you a physical mailing address that is not your mom’s house.

Your phone number is your own, so when somebody calls for you, reception answers with your company name. When customers or partners arrive for a meeting, they are greeted by a professional receptionist. If you rented your own office and hired a receptionist, it would cost you at least $3,000 a month, probably more. Through a virtual office, you can get all this in some cases for less than $1,000 a month.

But that’s not even the best part. If $1,000 a month is more than you feel you can spend, most virtual office providers will offer you their services individually. Don’t need a physical place to work? They can answer your calls and forward them to your cellphone. Even if you DO work in your basement, you can have your mail go to a professional-sounding address. You can even rent offices or meeting rooms by the hour depending on your needs. In most cases, there is a $150-200 monthly fee, but everything else can be paid for as you need it.

So when you’re starting out, your costs can be very low, and as your business grows and you have more meetings etc., the added costs should be more manageable.

Even if you can afford your own office, virtual offices provide a number of other benefits:

  • Never worry about your receptionist calling in sick.
  • If you’re on the road or even on vacation, your customers don’t need to know. Simply have reception forward calls to you.
  • Common office services like printing, faxing, photocopying etc. are available at a low cost.

It’s a great time to start up, and thanks to virtual offices, your initial costs will start as small as your business.

Start making use of valuable My StartUp resources while keeping your costs low with an introductory free MSU membership.


How to make your small business look big

shutterstock_66740776Imagine the following scenario.

You’ve been hashing out the details of your new business model over the last year, investing countless hours of your time, and now you’ve got yourself a perfectly serviceable business that needs to get some polish.

You only have a few issues to sort out and you will call yourself ready for a soft launch.

Fake it until you make it

First things first: your business was built in your garage with some servers, a high-speed internet connection, and a series of ever-increasing processing speeds to power your online offering.

You definitely can’t hold your first investor’s meeting in your parent’s basement, but you can demonstrate your professional bona fides with a virtual office. They’re basically a mainstay of the office space market now, with locations in most major cities.

For a one-off meeting, they’re perfect. No lease, no salaries, no overhead. Just everything you need for a pitch meeting to angel investors, including a smart administrative assistant, comfortable boardroom chairs, and an interactive blackboard.

It doesn’t stop with the real estate, either. Many virtual offices offer professional phone-answering services

Pricing varies based on how amped-up your needs are. For most start-ups with low cash flow, there is little risk taking on a virtual office for a day’s work, especially if it allows you to present your offering in a professional setting.

Longer-term commitments are also available once your business has grown, should you need more regular access. If you are more interested in a collaborative working space, these too are par for the course in the modern economy, and they have the additional benefit of giving you access to the minds of other creative people who can actually add value to your business.

Given the cost advantages and the low risk, there is absolutely no reason why you should feel compelled to sign a lease to rent, lease or purchase an office and all of the associated equipment.

Protect your business with an army of one service

Your company now has a lot of data: literally reams of vital user information, including financial and highly secure documentation, some of which is proprietary.

It is absolutely essential that you protect your business, and in your case, this means protecting all of that data at a reasonable price.

You are not quite in the same league (yet!) as Google or Amazon, so purchasing a server farm in the desert is not in the immediate future.

There is an immediate solution in the form of a cloud computing service. Rather than make the rather huge investment on physical infrastructure to meet your data processing and protection needs, you can save a lot of time, headaches, and ultimately, cost, by signing up to a cloud computing service.

There are ups and downs to the concept of cloud computing, but there is no doubt about its popularity and its ability to give the security of your business a professional touch for an affordable price.

Safety in numbers

If you are reading this blog, chances are that you are already well-aware that there are virtually limitless (and free) resources available through various organizations and groups that are oriented towards business development. The MyStartUp blog is a great source of insight, resources, and tips, often straight from the mouths of highly successful entrepreneurs.

Getting away from the computer, don’t ever discount the professional and educational value of networking opportunities, plus you’ll make a lot of contacts for a low price of admission to an event. Circulate around the booths and learn as much as you can, then bring your intelligence home and start modifying for your own purposes.

And did I mention how much you’ll gain from an experience as a mentee? Again, it costs nothing except your time and initiative, and it’s likely that you’ll gain credibility and insight from the experience.

You’d be surprised how many free templates, guides, or intelligence you will be able to add to your offering, just by exposing yourself to a broader group of similarly situated people.

In short, your business doesn’t have to invest a million bucks to act like a full-scale offering.

Throughout the month of October we will be exploring  some of the options presented above so check back often for more info. In the mean time, here are some resources to get you thinking about how you can look like a pro without spending a mint:

Virtual offices: http://www.intelligentoffice.com
Cloud computing: http://exocloud.ca/
Entrepreneurial mentoring: http://www.futurpreneur.ca/en/mentoring/
Design your own website: www.wix.com