No matter how much you plan, the future is unpredictable. That means growth can put all that you have at risk unless you address 2 different kinds of expenses:
1. the “known” expenses– e.g. rent, advertising, employees or service providers etc. and
2. the “unknown”- what you can’t predict. For a fast growing company in a global marketplace, there are lots of unknowns!
There are lots of ways to finance the known expenses, including bank financing, vendor credit, barter etc.I teach clients how to use my Mosaic Approach™ to increase their options for funding the known expense. To understand this concept, think of a decorative mural made up of different flecks of color. The concept of a Mosaic applied to finance takes advantage of the concept of divide and conquer. This involves dividing your financing needs into small pieces so that with each piece you put in place, you lower the risk to the next piece, so you conquer abundant resources. The more pieces you attract, the more credible your future becomes. Using this concept of divide and conquer, no single financial piece is responsible for your success and you are hostage to none!
Unfortunately, too many companies stop financing after addressing their known expenses. What about the unknowns? Just like your family has a cash reserve- in case of emergency – your company needs a safety net. There is only one way to finance the unknows: with equity.
That’s good news because equity can be your cheapest form of funding when your future is bigger than your past! Too many entrepreneurs assume that $5 million of equity cost more ownership and control give up than $1 million- but it’s not true, if you can get credit for your future today! The Mosaic Approach helps you make your future tangible enough for investors to buy today.
Getting the highest valuation from investors is not just a good idea. It’s a confirmation that you have found the right investors–those who see your future where others only see risk.
Click here for my free online course for details on getting money to grow your business while keeping control by addressing these 2 kinds of expenses.
Stefania Aulicino is founder president of CapitalLInkUSA. For 20 years Stefania has helped business builders uncover the right capital for their optimum growth strategy so you get cash and keep control to build the business you really want. www.CapitalLinkUSA.com
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