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Converting growth potential into profitable reality — with resources that keep YOU in control

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Category: Small Business

Is the weak economy keeping you down?
Not if you are an entrepreneur.

In a weak economy, entrepreneurs have the advantage because:

  1. Customers need your innovative solutions more desperately than in a robust economy;
  2. Companies in your marketplace are willing to experiment- what else can they do to resolve their declining revenue and profits?
  3. You can access higher decision-makers, with time on their hands, able to make the commitment to work with you.

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Stefania Aulicino

People say the biggest negative impact on their company is the recent credit crunch, yet few seem to be proactive about addressing this.

The confused credit market is the elephant in the room that no one is addressing.

You are not a bank, but you are a member of a business community: If you don’t protect your business ecosystem, you are actually putting your own company’s long term health at risk.

If you have access to credit, but your customers and vendors are suffering- why not be part of their solution.

If you are starved by credit, don’t cut back your business – reach out to those in your ecosystem who rely on your success.
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By Stefania Aulicino

Where does growth for your company come from?
Different prisms offer different insights: perhaps Mozart is an ideal model for entrepreneurs.

Mozart created music reflecting his inner genius. He played compositions for his own pleasure, then for a small group of friends. Those who liked the music arranged salons and invited larger audiences to hear the works. Out of this exposure, a benefactor emerges with an opportunity for Mozart to deliver a composition for a specific “customer” for pay.

  • Music was created first.
  • Heard by others
  • And paid for.
  • Demand for more compositions spread.
  • And prices rose.

What can "Business" learn from "Art"?
Packaging your genius fuels growth.
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By Stefania Aulicino

All businesses have a growth strategy, but too many pursue bad growth. Growth without profit is bad growth.

Profitable growth requires a sustainable business model. For entrepreneurial business builders, that’s doing what you love for people who benefit most from what you do best. When you pursue your passion, a sale is not the end; it’s the beginning of a cash annuity.

What is your customer annuity?What is the life-time value of your customer? You are not alone if you are saying “I never thought about my customers as an annuity.”

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By Stefania Aulicino

If you go to the airport but are not clear on where you want to go, any airplane will get you there. If you grow your company but are not clear on where you want to end up, any client prospect will take you there.

2009 was a wakeup call. A very challenging economy made it painfully clear that all growth is not the same.

Mic saw the revenue of his custom machinery company drop from $10million to $5million in 1 year in 2009 because he took the lazy path and accepted growth that came to him: I call that Reactive growth.

In contrast, Tina saw the revenue of her water management company increase from $9million to $10.5million with escalating profits to 10% because her passion guided her decisions. I call this Proactive growth.

What is the difference?
Proactive growth is passion-driven, translated into a set of financials out in the future.
Reactive growth is opportunistic.

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By Stefania Aulicino

Can you finance your passion – your company vision- the same way you finance your company’s growth?

If you had pursued your passion of the future you really wanted – your passion—in 2008, could you have changed the impact of 2009 on your company? In 2009 an incredible number of companies lost half of their revenue base.

Rob’s company was doing great in 2008- it was his best year ever- $8 million in revenue. By 2009, he had to cut 26 employees and was down to $3 million.

“Cash was not the issue” Rob said. He still had a bank line of credit and plenty of internally generated cash flow because his customer terms were 40% with order and 40% progress payment on top of healthy profit margins. So what happened?

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By Stefania Aulicino

When you need cash to grow, consider accepting my challenge: take equity off the table. Stretch yourself!

Equity is the lazy way to get cash. All you have to do is give up some of your ownership. Anyone can do that. Equity is overused and way too expensive for most of your growth needs.

 

Alternatively, if you are willing to apply some creativity, here are 2 of the cheapest ways to get cash to grow:

  • Negotiate expenses
  • Alter time

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By Stefania Aulicino

If you ask for cash the old way, you know what you will get… or more precisely, what you will give up!
Here is a new way to ask for cash to grow. It takes 3 special SKILLS:

1.      Declare your one-of-a- kind future

2.      Profit from your one-of-a-kind relationships

3.      Earn one of kind a pricing

Let’s look at those 3 skills.

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By Stefania Aulicino

Ask people who know and respect you, personally or by reputation.
More people are looking to put cash to work outside of the normal channels. They don’t want to put money in the stock market. With fewer traditional choices, many are open to put cash to work with people they know and trust.

The economy is NOT the issue.
It’s cheap to buy market share. Money goes a lot farther in a recession: top notch talent is available; real estate and resources are cheap. You can actually get more attention from decision-making executives with less competitive noise! You can get public notice for your actions with PR value. Besides, it’s easier to grow than to slow down growth. There are still buyers in this economy. The down turn will not last, and you will be ahead of the game when the economy improves. Do you really have a choice, anyway?

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By Stefania Aulicino

How many people do you know who spend their own money and know you- personally or professionally?

Yeah! A lot!! The biggest mistake Business Builders make is not inviting people whom they know to share their passion.

Do you harbor secret fears that prevent you from sharing your passion with people you know?
Fear you will not achieve your future?
Fear to admit your company needs cash?

Let’s look at those two fears.
1st– Do you fear you will not achieve the future? Guess what- that is not a surprise!

Know any friends who have a career goal? They may or may not achieve it.

Know any colleagues who have 12 month sales goals. They may or may not achieve them

No one expects you to be different. The future by definition is an unpredictable.
The difference is your future is BIG, EXCITING and CONTAGIOUS so others want  to participate in your PASSION.

2nd Are you embarrassed to admit your company needs cash? People know the difference between growth and survival; between investment and expense.

If you pay for your child’s education, you are investing in your child’s future success. If you pay for a cruise, you are spending money. Both use cash; one is an investment that has a future return. The other is an expense which does not.

As Business Builders we quickly learn growth consumes cash. The reason you need cash is to make the future you can “see” real. That’s different from needing cash to address yesterday’s excesses or to merely survive.

Cash in the hands of a Business Builder yields its own repayment. Growth funding delivers a product or service which earns a future profit.

If you just wanted to generate cash, all you need to do is stop investing for the future. Just staff for yesterday’s revenue levels. But that’s not you.

You’re a Business Builder so extinguish those secret fears. You’ll find the fastest way to get the right cash is to reach out to those who know YOU, personally or by reputation. People who know you AND spend their own money. People who are principals, not agents who invest the funds of others. Agents such as the bank or venture capitalists or Angel investment clubs. That is the difference between “creating” vs “finding” funding sources.

Principals offer you the biggest return on your passion because they are people who have a basis to believe in you. Principals are Fast, Cheap, Want you in control.

  • FAST because they don’t have to analyze. Principals are building on long term relationship with YOU, or your reputation.
  • CHEAP because principals catch your passion and assign a lower risk premium to your future.
  • Want YOU in control so you can get cash on your terms. Take equity off the table; giving up ownership to get cash is the lazy way to do it. Instead, be simple- like an IOU that you repay as cash flow allows at your discretion, based on trust. Or be creative. Remember, any reduction in an expense is the same thing as cash to pay expenses- such as delayed terms or price discounts as a long-term partner relationship.

Plus, you know them all. It’s just a question of prioritizing and applying your new skill of inviting people you know. Don’t expect to get all the funds you need from a single source – use the Mosaic Approach.

Best of all, you don’t have to pay any commissions or fees for principal funding sources.

As you can see, there is no reason to be afraid of asking your friends to fund your company’s growth. Don’t let unfounded secret fears prevent you from sharing your passion with people you know. Don’t worry about who has discretionary funds; you can’t know that. Ask everyone. “No” is always an acceptable answer but you will never get a “yes” unless you ask.

When you reach out to people you know for cash there is a snowball effect. Once the first one buys your passion, the next one is easier. Perhaps it’s the mounting credibility of the number of people who believe in you. Or perhaps you’re getting more comfortable making your future tangible enough for others to buy it. Either way, sharing your passion with people who know you is the safest way to get the right cash to grow.

Stefania Aulicino, president of CapitalLinkUSA ensures business owns get cash to keep control of a bigger, more profitable company, faster, safer than they ever thought possible- in any economy. Let us help you become a magnet for non equity and equity sources to fuel your growth. Please explore our tools, solutions and consulting options tailored for different growth stages and different budgets: www.CashAndControl.com