Ok, we’ve walked through the steps you should be taking to prepare yourself to level up and hit the elusive 7 Figures Club. But here’s the thing, in Canada, only 2 percent of women owned businesses reach $1 million and up in annual revenue.
There are myriad reasons for this crap news but the biggest one is this – lenders and the overall financial landscape remains (and yes, I’m generalizing as there are always outliers) stuck in a time-warp.
But we’re here to change that, right?? People in positions of power – especially those who control the purse strings – are more apt to take you seriously when you take yourself more seriously.
By this point you should have had your business incorporated, intellectual property trademarked (invest in protecting your brand and your intellectual property through trademark registration, asserting copyright, clear terms and conditions when providing content and being vigilant about nipping any IP theft in the bud), perhaps you’ve even created a holding company and/or trust to protect your vital assets should sh*t hit the fan.
And if you’re looking to lure investors who will help take you to that next level – you MUST treat your business like the big deal it is! If you’re hitting a wall when it comes to financing your company? There are things you can do to help you if you can’t get loans from a traditional bank, credit union, or other type of lending institution.
You can look for investment, which, in a sense, is less risky than financing through debt (where you are 100 percent liable and will usually need to provide a personal guarantee). Now, of course there are pitfalls to this option – especially if you’re growing rapidly and starting to feel a little…desperate, maybe?
Imagine you need marketing help, or a sales coach, or an additional employee to help you get to the next level – and someone is willing to offer you their services for, or, I don’t know, a 10 or 20 percent stake in your business – no cash changing hands.
Sounds great, right? Almost manna from heaven! I don’t have to pay you and you’re going to give me all the services that I need!?
And I fully understand that feeling (BOTH the desperation and the relief!).
But step back a second. What if the hard cost of those services would only amount to $20,000 – and your company ends up being worth a million-plus?
Well, at 20 percent, you’ve just “paid” $200,000 to get $20,000 worth of services. YIKES! It is an expensive way to fund your growth.
Imagine: You are suddenly attractive to people with those deeper pockets you’ve been clamouring for – but you’ve given away so much of your company getting to that point you’ve become a minority shareholder! Trust me – this happens!
Don’t Procrastinate When it Comes to Securing Financing
Now I’m going to give you the hard truth. Debt SUCKS and has the potential to stop your rise before you’ve even gotten started.
Here’s the thing – MOST of us have been in debt. You’re starting out, you have a dream, you don’t have access to resources or boatloads of money, so you pour everything you’ve GOT (and most if not all that you don’t have, including maxing out credit cards and your line of credit!) – come on now, I know some heads are nodding out there right now – and you’re >this close< to running out of cash and THAT’S when you go for funding.
NOT a good idea.
You will not get financing if you are in debt up to the wazzoo! Even the most liberal of financial managers won’t touch you.
Go after funding when you still have savings, when you’re regularly paying off your credit cards, when you still have access to a nice chunk in your line of credit. It makes you look financially viable AND financially mature and financially trustworthy. And don’t ever get into debt with Revenue Canada – trust me, no one will touch you with a ten-foot pole.
Get the best bookkeeper you can (one of the wisest investments you’ll make over the life of your business). And for heaven’s sake, ladies, pay for excellent advice and do it NOW!
You don’t have to be a million-dollar company to seek advice – learn how to accumulate money and then structure things in a way that makes you tax efficient. Or how to present your accounts in an appealing way. Or how to negotiate with those investors we talked about above, in such a way that you DON’T end up losing your company in the end.
Plus, the more you know, and the more you’ve done with your company before you start hitting up lenders and/or investors, the greater the chance you will land the money you need to get to that elusive seven figures.
To end, here’s something you should write on sticky notes, and stick them all over your house, office, car, heck forehead even!
This really stuck with me because it’s SO TRUE – in every area of life:
WE OFTEN DON’T GET WHAT WE DESERVE. WE GET WHAT WE NEGOTIATE.
I have the tools to help you, if you see that 7 Figure hanging fruit, you KNOW You can brush your fingertips against it when you reach up – but you’re not 100 percent sure you, or your business, are ready to level up. I went through it myself when I was building MY business! I can help talk through the variables, make sure everything you’ve spent years building is protected and ensure that your company is the shining example on the hill when it comes to being a perfect match for potential investors.
So, don’t hesitate to reach out for a chat about what we can do together moving forward! You’ve worked too damn hard to not reap the rewards of levelling up.
If you’re serious about taking that step, book a call so we can talk.