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The Importance of a Policy and Procedures Manual for Small Businesses

A policy and procedures manual is just what is says, an outline of all the key procedures for various processes within the business. Although a policy and procedures manual can be a lot of work and it would not seem to be that important with so many other pressing concerns in the early stages of growing the company, when you start hiring employees, even just a couple, it can greatly simplify things. Having clear instructions for things like making changes to the code on the server and outlines of appropriate use of company emails can both save a lot of time explaining things and even more importantly dealing with mistakes and potential issues with employees.

The manual should also include steps in the event of an issue, such as warnings escalating to dismissal. One day it may be necessary to fire an employee, and in today’s litigious work environment, this may be difficult to do unless you have clear cause. Without understood guidelines regarding performance and policy and procedures, proving cause may not be possible. A well written policy and procedures manual shared with employees when they start their employment will help to eliminate any debate over whether any specific “rules” were broken, and will make the termination go much more smoothly.

A policy and procedures manual can be a work in progress too. It is not necessary to have a complete volume finished before your first hire. Start putting together a few key items when you begin operations and add to this as things come to mind. Before you know it, you will have a very comprehensive and complete manual.

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com. Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

Business Partnership Top 2 Challenges

Although the idea of starting a business with your best friend may sound like a great idea, these relationships often become very complicated. Partnerships can put tremendous strain on friendships. Whether the business succeeds or fails, conflicts inevitably ensue. Often the former is the greatest source of tension.

 1.      One partner feels the other partner is not working as hard and contributing to the success of the business to the same degree. This partner feels taken advantage of.

2.      One partner would like to sell the business while the other would like to continue building it.

Off the shelf incorporation kits are cost effective and quick, but all that print embedded in the seemingly innocent looking legalese can come back to bite you. It’s a very good idea to bite the bullet and sit down with a qualified lawyer to hash out the proposed structure of the company including the various rights of shareholders, especially if you do decide to enter a partnership.  

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com. Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

Ego, the Pitch, Estimates, Purpose and You – General Tips for Capital Raising Summarized Into 5 Paragraphs

Put Ego Aside
Most successful entrepreneurs have reached out to friends and family in the beginning. I’ve come across too many who let their pride get in the way of fundraising and believe that they can do it all themselves i.e. getting investors from cold calls. Reach out to those who believe in you and don’t try to do too much yourself. Get help!

Pitch the Opportunity
When asking for money, always treat it as though you are truly giving the investor an opportunity and imagine how upset they would be when the business succeeds, and you didn’t give them the opportunity. This will change your mindset during the pitch and give you the confidence you need to succeed.

Double Estimates
When you’ve estimated how much money you will need to execute your business plan, multiply it by two. It always costs more than you expected, and things always go wrong.

Investing in Business or You
Remember that investors are first and foremost investing in you, not the business. They know that things will go wrong. In fact, I’ve even heard a VC say that the only thing they know for sure will not happen is what is written in the business plan. When you need to pivot, either big or small, they want to know that you’ll be there to see it through.

Passion and Purpose
Passion is often talked about and investors definitely look for this. But even more so they are looking for someone with a purpose. Someone who is building a business because they want to accomplish something, to make a difference, and nothing will get in the way of that.

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com. Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

Be Wary of Capital Raisers Who Cold Call You

Be wary of companies or individuals that claim they will find capital for you, especially if they are cold calling.  All to often they are simply in the business of getting money FROM you. Here are some warning signs:

  • A poorly crafted website often with typos and grammatical mistakes indicating that it was hastily put together;
  • Limited information about principals and what information that is available gives little indication of their ability to raise capital;
  • They are immediately interested in your project or business and claim early on that they have several interested investors even though they’ve been given little or no information and you have spoken with none of their principals;
  • They are unable to provide any references of other fundings they completed and often claim they can’t because they are under non-disclosure agreements (NDA’s);
  • They are unable to provide a standard finders fee agreement and instead offer a verbal or paragraph long term sheet (often with errors);

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com. Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

No More Than 1 – 2 Drinks with Potential Investors

Drinking With Potential Investors

Although it is important to sometimes build rapport with a potential investor, it is best to do this in a non-alcoholic or limited alcohol environment.  Meeting for lunch or after work and having a beer may be a good way to open up and discuss the opportunity, but be sure that the prospect sets the tone and orders first.  Limit it to one or two drinks only.  Sometimes it can be tempting to go out “on the town” with a potential investor, but staying out all night and getting drunk rarely will produce anything more than a hangover.  Firstly, even if the prospect indicates that he’s interested in investing, he either won’t remember the next day or feel like he was compromised when he made the decision.  Plus, it just doesn’t look good if you’re out partying, even if he is.  Shouldn’t you be focused on the business?  Stick to coffee and if drinking, no more than 1-2 drinks.

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com.  Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

Applying for Small Business Grants

Grants are great if you can get them. There are many different types of business grants that are available through government programs which are created primarily to incentivize economic development and promote entrepreneurship and free enterprise. 

The Challenge with Grants

The challenge with grants is that they usually require a lot of work and can be very time consuming to get, if you get one at all. It is possible to spend a great deal of effort putting together your application and related materials only to have it rejected, or simply receive no response. 

Increasing Your Odds

When applying for a grant it is important to understand that there are likely a lot of other applications, many of which are just as good if not better than yours. Even if your application is the best, you still may not get the grant. Keep in mind that your application is likely in a stack and can easily be overlooked or at least not given the consideration that it deserves. Assuming all things are relatively equal as far as the quality of your application vs the other top applications, you need to ensure that you get the attention of the grant reviewer. This means finding out who the reviewer is, that is the decision maker is, or who recommends to the decision makers, and then putting your application front and center in their mind. This is done through frequent contacts. You don’t want to pester them and keep asking the status once submitted as this can have negative consequences. It means developing a one on one relationship with the reviewer. The process begins long before your application is submitted. Once you find out who the reviewer is, you need to reach out by phone or email, preferably the former, and ask regular questions about the grant. Even if you already know the answer to the question you are asking, you still call as it keeps your company fresh in the reviewers mind. Don’t hesitate to reach out every day or two.  The goal is that by the time you submit your grant application, the reviewer is so familiar with your company that he/she doesn’t even need to read it.

Rather than look for a specific type of grant, explore all available grants and then figure out which ones your company would qualify for. Searches for grants produce links to many websites, usually government related, that will list all of the possible grants and summaries of qualifications and deadlines for application submission.

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com.  Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

Raising Capital from Friends and Family

The main reason friend and family capital is the easiest is because these are people who know you and trust you. It is this trust that is the main reason they are investing, less so because of the business plan. If you are looking outside of this group then it is more about the business plan. However it is still critical to have a contact that you have a connection with.   Focus on potential investors with whom you have a relationship of some kind, someone who knows you, someone who at the very least has met with you at least once.  Cold calls for capital are almost impossible.  People simply don’t invest in companies where they don’t know the principal or have a friend who knows the principal.

For more information on raising capital and handling the other unique challenges of running a small business, visit our site at https://www.riskebiz.com.  Register to receive a free copy of our upcoming “Small Business Survival Guide” book and connect with accredited investors to potentially fund your startup.

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