Financial matters are undeniably at the top of any business priorities, most especially when you are just starting. It is often a struggle to find the right financing to get the business going. Tiffany C. Wright of The Resourceful CEO shows us all the ropes of getting the right funding for your business. She lays down some advice on finding funding if one bank turns you down as well as some of the possible reasons. Tiffany gives some ideas on how to be creative with looking for alternative financing. And not forgetting the basic questions, she confronts by getting down to the roots, asking: “What do you need it for?”
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Tiffany C. Wright on Finding Funding For Your Business
I have on a special guest and her name is Tiffany Wright. She has helped numerous small and medium businesses find funding for a variety of purposes for many sources. I’ve asked her to come here to talk about how you too can generate the business financing that you need to grow and achieve your business goals. Tiffany is the author of the book, The Funding Is Out There!: Access the Cash You Need to Impact your Business. Whether you’ve got a $300,000 transportation business, a $20 million business services company, or maybe you’re an aspiring entrepreneur and you’re looking at options, Tiffany Wright has the information and the strategies for getting your business needs financed. Tiffany, welcome to Heartrepreneur Radio.
Terri, thank you for having me.
One of the questions that I do get asked a lot is, “What do I do? I need to get some money. I want to spend money on marketing or business growth. I want to hire somebody, and I don’t have the funds. Do you have any ideas?” It’s not my area of expertise and that is yours. How did you get into this?
I served as a business advisor to a number of companies and some approached me and asked me how do I get funding. Many said, “I can’t get funding.” I said, “First of all, didn’t your parents teach you don’t say, I can’t? Second of all, there is funding out there. You just have to think differently about your funding.” If you get turned down by one bank, then maybe your business isn’t ready for banking or maybe it’s the wrong bank that you went to. This is what I always said, “First, step back and determine what you need it for and then how much you need.” In that order. That will help determine what types of funding is out there for you. I got frustrated. For everyone else, it was new but for me, I started to sound like a broken record. I speak at events and I would have clients come in and it was the same thing. After about 40 or 50 people, I had some advisors and my dad who said, “You should write a book,” so that’s what I did.
I always wonder what has people drive to write the book and how they get it done and why did they get it done. What is the need? What do you need the money for and how much? They’re simple questions, but I know from talking to people that sometimes they don’t know what they need it for. They don’t even know the amount. I love that you’re helping people start out with that clarity.
If you say, “I need $20,000,” what do you need it for? I want to do a little bit of marketing. I want to do a little business development and I need money to pay the rent. How much do you need in each case? If you’re a growing company, you need $1.5 million to hire a number of people, develop software, and so on. It may be that you can get $1.5 million from an angel round of funding or it could be that if you have enough cashflow, you can get part of that from a bank. Part of that is from investors and part of that depends on if you’re doing development through one of the government funding programs. If you’re small and you don’t have the historical cashflows, your options are more limited.If you're small and you don't have the historical cash flows, your options are more limited. Click To Tweet
It is true that when you have cashflows and you have profitable history behind your business, it is easier to get funding from just about every source. If you don’t, then you can be creative, and you can think about marketing. Maybe there’s someone I could co- market with and maybe it’s an additional add-on offering for them so they’ll pick up the tab. That’s what I mean about knowing what it is you need. Rent, people often enter into leases of where they have more space than they need at that time, so you can sublease at a much lower rate than getting a new office building yourself. These are the other options that you have to reduce or have your costs covered by someone else and that’s alternative financing.
How does the business owner know if they need alternative financing? When do we say, “I have to do this?”
Unless you can get someone to co-market or sponsor or even swapping or bartering, it’s a gap, an accepted accounting principle is recognized by that. If you need $50,000 or more and you’ve had difficulty obtaining funds from a bank, you have iffy credit or your business doesn’t have credit, then I would consider alternative sources. That could also be supplier financing. People don’t realize that your supplier may not just give you terms 30 and 60 days. They sometimes will finance inventory or supplies for six months or longer. If you have difficulty, that’s when you start to think about alternatives.
Let me ask you about one alternative that shows up a lot. What about PayPal? They offer 0% down, 0% financing. What do you think about that?
I like PayPal. I do have a line of credit with PayPal. PayPal is focused on business customer, so they typically don’t report on your personal credit. Build up as much of your line of credit through PayPal as much as you can. If you have a $5,000 line of credit or a $10,000 line of credit, you can use that to buy a lot of the supplies, travel, and so on through PayPal. Lots of entities use PayPal. That’s a very viable option.
Let’s say somebody’s thinking, “I do need this. I know the what? I know the how much.” What’s the couple of action steps that they can take?If you need money from anyone, it's good to have what you need it for mapped out. Click To Tweet
The first thing that they should do is write up an executive summary. If you need money from anyone, even if you’re approaching a marketing partner or someone like that, it’s good to have what you need it for mapped out. The process of writing a three-page executive summary really helps you. It put a description of your business, what your business does, where you see growth happening, what funds you need, and why and where you think you’re going to get it from. Going through that process helps you to identify other issues you may not have thought about and also helps you to be able to articulate it. There has been so many times when I ask people, “What do you need?” or “Why do you need it?” You might run into someone who can help you but if you can’t quickly tell them what you need or why you need it, then you’ve lost that opportunity.
How can people get your book? How can they get in touch with you if they want to move forward?
You can get my book at BarnesandNoble.com, Amazon.com, Books a Million. They can also reach me if you need to reach me at TheResourcefulCEO.com. You can contact me through the Contact Us page and I always respond within 24 hours during the week.
Thank you so much for being my guest here, Tiffany Wright, at Heartrepreneur Radio.
Thank you so much for having me, Terri. I appreciate it so much.
You are welcome.
- Tiffany Wright
- The Funding Is Out There!: Access the Cash You Need to Impact your Business
- The Funding Is Out There on BarnesandNoble.com
- The Funding Is Out There on Amazon.com
- The Funding Is Out There on Books a Million
- Contact Us
About Tiffany Wright
Tiffany C. Wright is a former COO, and CFO, and business advisor of several small to medium businesses. In these roles she accessed over $40 million in financing and a similar sum in contracts and purchase orders. She has driven M&A, turnarounds and restructurings, partner programs, and more. Tiffany has over 18 years of finance, strategy, management, and operational experience in a variety of industries including business services, financial services, high tech, and real estate.
Tiffany is also a serial entrepreneur. She formerly owned and operated a multi-state residential real estate investment firm and a commercial construction trade publication. Tiffany has worked abroad and held several corporate management positions. She obtained her MBA from the Wharton School of Business (University of Pennsylvania) and her B.S. from The Ohio State University.