By: Laura Zeppieri, MBA Candidate, Marlboro College
From the session: Where Do Entrepreneurs Find the Money? with Janice St. Onge from VSJF Flexible Capital Fund and LC3, Chris Sikes from the Western MA Enterprise Fund, Ryan Torres from the Vermont Community Foundation, and John Hamilton from Vested for Growth NH Loan Fund.
There are a lot of different ways to get financing for entrepreneurs, as demonstrated by the myriad of different venture capitalists, angel investors and financial advisers that met during this session. But the most interesting information I got out of the session was from the Q&A after. Many entrepreneurs are looking for a way to get started and have trouble getting money from the previously mentioned sources. For example, John Hamilton at the Vested for Growth New Hampshire Loan Fund hosts an Investor’s Circle that has organized social inventors to invest in socially responsible business, which is great except they only fund one or two projects at a time. It makes it hard for entrepreneurs to get the cash and support they need.
When a question was posed about bootstrapping and getting money and support from sources that are not as traditional. Bootstrapping usually uses the 3 F’s (Friends, Family, and Fools) and was advised as the best way to get started, then it’s best to move on to other start-up resources, such as grant programs that are non dilutive and then going into individual angel community. Since the slow money movement is emerging in the angel field, it might be easier to find an individual who wants to do good. Last, customer and vendor financing is an option.
Another important point the panel brought up that is especially important for entrepreneurs is forming an advisory board. Start-ups need not only equity, but mentorship too. Start-ups should form advisory board to reflect weaknesses and match strengths, since it’s unrealistic to expect that you’re going to be excellent at each section of business. It can also help bolster the vendor financing option, since it will help to work with both and leverage with the advisory board and building team you might not otherwise be able to afford.
What do you do if you’ve tried all this and there are no more options? Well, they didn’t have an answer for that one. My only suggestion would be to not give up. There are a lot of opportunities, and waiting for the right one for you will be worth it. Just keep looking for the right opportunity. Personally, it took awhile for me to fund my business Zippers, but using some bootstrapping techniques (especially from Guy Kawasaki’s book The Art of the Start), applying for funding from different sources, and keeping a good relationship with my mentor helped keep my business intact while I waited to get the capitol I needed.