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How do you get funding and advice to start a business?


Todd Pernell Louisville, MS

I recently resigned from my Job because I was passed over for promoting two times after I earned my Masters degree, and I want to start a business.

25 May 2015 21 replies Small Business



Robert Paiva Houston, TX


I congratulate you on wanting to start a business. I must caution you first that most new businesses fail within the first 2 years and there's a very good reason for this. Starting a business is a very difficult task. Before you begin to jump in with both feet you need to have some very specific matters put well into place before you go drawing up business plans and start raising seed capital.

First, what business are you going to have? Will you offer a service or a product? Can you provide this just by yourself or will it require others to help? How much capital are you willing to commit to this business first? How do you plan to make money doing it? How much is it going to cost you to launch it, stabilize it and then operate it each month? Can you afford to not pay yourself for a while - up to possibly 2 years? What industry will you be entering? How will you compete? Do you already have customers lined up? If not, why not?

These are pretty rough questions and I have many, many more but these are just a few that you MUST have answers to before jumping in and going great guns with a new business idea.

I have started many companies, both of my own and as a consultant for many others. I have two successes I can reflect on with great pride and all the rest were failures. And most times we had all those questions above answered very well. Some were started with zero outside capital but most we raised money and lost it for our investors. Not a fun place to be in, I can assure you.

Today's economic landscape is not small business friendly, especially for those that require outside capital to launch. I do this for a living and I can tell you, it isn't that much of a living anymore because it has become incredibly difficult to secure enough proper investors.

My advice to you: start small. Own it all by doing everything you can first by yourself. Get customers and start invoicing, e.g. getting revenues coming in. Be a miser and preserve your capital for the first few yours. Let it grow and refrain from paying yourself if you can. If you must draw a salary, pay yourself only what you need to survive until you have enough reserves that a respectable salary wont effect the business's monthly budget. If you start to hire employees , pay them first always. Get a very good and trustworthy accountant/bookkeeper. Make sure your file your corporate documents correctly and pay your taxes on time. Get an attorney in whom you trust to work with you and do not offer or sign a contract of any kind without at least getting his/her opinion first. Get a trusted business adviser/mentor whom you look up to that has done this before. And keep that person as close to you as possible as you get things started.

Prepare yourself, your wife and children (if you have them) that your about to enter into very long and stressful days. Many things will not go your way and you will have to be prepared for the long game otherwise you will create additional hardships in the home.

And lastly, put off seeking investors for now. You will spend countless hours working on creating a paper tiger that investors will just chew up and spit out. Instead spend that valuable time, money and energy into building a real-life business and then let the investors come to you.

I wish you all the best but know that building a business is a separate business than running your business. Good luck.

25 May 2015 Helpful answer


Dennis Nadeau Pompano Beach, FL


What kind of business are you looking to start?

-are you going to offer a product or service?
- How much are you looking to raise?
- what are you offering for the money raised, debt or equity?
- what is your company structure, Inc or LLC?

These are some of the questions you need to answer before you start our new business.

You will also have put together a pitch deck (executive summary, 36 month proforma along with assumptions). Most investors want to see this type of information before they make any type of investment.

If you do not have a pitch deck, I can send you ours. We were successful in raising an equity seed round from friends, family, business associates with what we out togther.

Ican send you our original files, so you can edit them accordingly if you like.

You can also see some tips here for creating an investor presentation;

Once I understand what you want to do, I may be able to offer some helpful information. Best, DN.

25 May 2015 Helpful answer


Alan Millner Lexington, MA

I suggest you contact SCORE, a volunteer organization associated with the small business administration, they probably have a chapter near you ( I work with the Boston chapter.) See . They can help you prepare a business plan, evaluate funding sources, and assist you in developing your business.

25 May 2015 Helpful answer


Ted Mittelstaedt Portland, OR

I own a small business, here's my advice:

1) Businesses are either service companies or product companies. For a service company to get big the founder has to be interested in only 1 thing - sales and management. Which is kind of ironic. Large service companies are all about the founder selling his "word" that he's going to always be around and always be able to browbeat some poor tech into doing the work the customer needs done. So the founder of these companies has to absolutely focus on that only.

2) For a product company to get big you have to have an invention or better mousetrap that is patented, or location (if your a restaurant for example). With these the customers don't give a rip about the salespeople, as long as the product does what they want they will keep buying. So the founder has to be an expert in the product and he or she can always hire someone to do sales.

Of course there are hybrid companies and there are small single consultants and such out there who break the mold, but with most companies they fall into 1 of these slots. Usually, service companies that try to dabble as product companies lose a lot of money. It is generally easier for product companies to transition into service companies - IBM is an example of one of these, for instance - or for product companies to run a service "arm"

And last and most importantly of all - the biggest reason (in my opinion) that businesses fail? it is lack of a saleable product.

This is a huge thing I believe. It takes a gigantic ego to start a business. You have to believe that your good enough that people will pay for you or pay for your product. That is going to block your view of reality, and there is nothing that can prevent that.

You need someone who is outside of your little world that knows the market your wanting to be in and can tell you "that's a stupid idea nobody will buy it"

Unfortunately, we are flooded with "success stories" of people starting businesses where everyone told them "that's a stupid idea nobody will buy it" and then they go off and make a million dollars. So that adds to the myth that if you have a great idea then there's always going to be a market for it. But the reality is that these stories make the news because they are so unusual

Most SUCCESSFUL small business starts are BORING. The founder knows his product, knows his market, and has created a product or service that is useful to customers and they want to buy it. So those don't get any press. I bet for example that in the last 5 years there's been 2 new used car dealerships started in your city that are prosperous - and you don't know about them. Because - they are boring.

But the FAILURES - well every time I read about a business failure (since the failures always seem to make the news) I think "what were they thinking that's the stupidest product I ever heard of"

I'm not talking about bankruptcies. Contrary to popular opinion a business bankruptcy does not always mean a business failure. Often it means mismanagement of the business and 6 months later the founder has popped up somewhere else and is hawking the same thing she or he was hawking a year earlier, still making money, just a bit wiser about it.
The majority of small business starts that fail don't end in bankruptcy.

But, in my opinion, with the vast majority of business starts that fail, they fail not because of inadequate funding or mismanagement or any of that. They fail because they simply don't have a product or service for sale that people need or really want that much. You may think your business has a good solid product or service but that is not important - it's what others think about what your selling that is important. If there's no need for it - if there's already too many restaurants, or ice cream shops, or concrete companies, or used car dealers in your market - then your not offering anything that anyone really needs. Your going to fail.

And that's pretty ego-deflating to admit, which is why more people like to say they failed because of money/management/insert excuse here.

14 June 2015 Helpful answer


Bob Molluro Wilmington, DE

I would suggest that before you worry about funding decide what business you are going to start. Here is some general advice to get you started. Go to Michael Gerber's website and read his seminar work The Emyth. Most people who want to start a business have no clue on what they are getting into even if they have been in a business environment for years. Another good source is Lots of great info and tools for any entrepreneur. Since it looks like you have been in the military for quite some time and that your education is in business, outside of your passion to want to be an entrepreneur and your concern that you have been passed over you really don't bring much to the party. I hate to be son blunt but who in their right mind would invest in you. My recommendation is become a number two and piggy back off someone else who is already doing a start up that you are passionate about. What I can tell you about being an entrepreneur is what ever effort you put into your previous work endeavors be prepared to double your hours (24X 7X 365) for at lot less that you were getting before until you really know the ropes. The only thing that will get you through this is your passion for the vision you have and your work ethic. Another educational source that I have used is that if you search the web Stanford has sessions that are moderated by professors who interview entrepreneurs for their students. you can sit in on these sessions free of charge.
My other bit of advice I always give people is never quit your present job until you have another position that will at least enable you to sustain your living needs. Starting a new business is never an overnight suggest and most businesses fail because they are underfunded. I hope the brutal truth helps to get you on the right track. My best to you.

8 June 2015 Helpful answer


Kris Larson Sarasota, FL

If you happen to be considered a Disabled Veteran then I would suggest starting here. If you are not already familiar with it. There are a lot of schools that participate in this program and it began with Syracuse University originally.

Florida State University EBV (Entrepreneur Bootcamp for Veterans with Disabilities)

I am an alum from 2011 and it is a fantastic program to be apart of and I highly recommend applying to FSU. They did an amazing job working with us Veterans. It is ALOT of work but, it will certainly give you BOOTCAMP style exposure to entrepreneurship and a great confidence and foundation knowledge. It also gives you amazing resources, network and also support services once you have completed the camp (9 days). There is a business plan competition every year and the prize money continues to go up every year. I won it when I went and it was a great confidence boosted and the seed money really helped. The do the biz plan and other fund raising opportunities at the National conference every year as well.

It is paid in full by the school and donors so you son't have to sweat the expense. I drove up to Tallahassee because I live in Florida but, I believe they pay for your air fare. The also do a National Alumni Conference every year as well which is great.

i agree with a lot of what Robert has stated although, I would say that after my years of experience in the military and working in the civilian sector for the last 11 years I would caution you to not get to wrapped around the axle about how HARD it MIGHT be. Just remember that although it may be hard, it won't be any harder or better yet worse then sitting in a fighting hole getting shot at sitting in the middle of the desert.

I believe the most difficult part is finding your passion in all of it. Because at the end of the day, yes you need to get paid of course but, if it's not FUN and you don't feel the freedom in it, then really what's the point. Your time is more valuable than the money. You can always get more money but, you can never get back your time. So be as certain as you can about where you spend that time.

The other piece that Robert mentioned was to start invoicing and getting that steady stream of income coming in. That's where I believe most business fail to get to and thus never become sustainable. Also, seriously keep this in mind. If you estimate the time frame at which you believe it will take to reach that level of stability you definitely want to prepare that it could take WAY longer than you had hoped.

I hope this helps in some way and if there is anything I can do to be of assistance I too would be happy to brainstorm with you or assist in anyway.

Kris Larson
Sgt. USMC - 2000-04
FSU EBV Alum - 2011

2 June 2015 Helpful answer


Carol Lindberg San Diego, CA

Veterans learn important skills from the military that can help them start a small business such as leadership, teamwork, perseverance and adaptability. However the military doesn’t teach them how a business actually works. After military members transition to civilian life, they need resources to learn how to start a new career which could be owning their own business. According to the Institute for Veterans and Military Families, veterans are 45 percent more likely to pursue owning their own business. One of the most asked questions is how to raise capital for a small business. Depending on your business model, experience and current resources will determine the best combination of funding. Here are four ways to acquire capital for your small business.

1. Institutional Loans
Big bank and institutional lenders are increasing the percentage of small business funding requests that they see by approving 23.4 percent of loans an all-time post recession high. But that doesn’t mean it will be easy to get a loan from the bank. You should establish a strong bond with your bank before asking for a loan. It’s not all about the money, but about the relationship you have with them.Most bank loans are given to businesses that are already making profit and it is difficult to get a loan for a startup.Interest rates run between six and eight percent depending on the amount and you typically need good credit. Don’t worry there are other financial options available for new businesses.

Institutional Loan Resource:

2. Peer-to-Peer Lending
Facilitated by the ease of use with online sources, peer-to-peer (P2P) lending allows small businesses to get capital without using a financial institution. P2P lending gives direct interaction between those attempting to get capital and investors. Most don’t need any collateral for the amount borrowed and often have better interest rates than banks. P2P lending sites give approval quickly. Lending Club is America’s largest online credit market, but to get a loan must be in business at least two years and more than $75,000 revenue. The StreetShares site focuses on lending to veteran-owned small businesses. Borrowers need one year in business but only need $25,000 in revenue.

P2P Resource:

3. Business Credit Cards
For entrepreneurs who don’t qualify for traditional loans or don’t have access to investors, small business credit cards are a popular option. These types of cards often have higher spending limits and more generous reward programs than consumer cards. Some have low interest rates or balance transfer programs, however; many business cards come with annual fees and require good credit history. You can avoid paying interest on most purchases if you can cover the monthly payment. A few cards also have added benefits when used for travel, so if you have to visit locations for your business look for a card with those rewards. A credit card can help obtain capital for your business as long as you don’t purchase more than you can afford.

4. Crowdfunding
When you start a business and need capital to get it up and running look into crowdfunding. This allows you to pitch your product or concept to potential investors and then reward them if they invest. This reward could be your first product, logo t-shirt or unique item. Check out sites like Kickstarter, Indiegogo and Tilt to see what types of campaigns have worked and which place will best fit your type of business. Typical crowdfunding sites have either an all-or-nothing model (get funding only if you reach specific goal) or a keep-what-you-make funding model. While the latter gives you more flexibility, it may leave you shorthanded if you need a certain amount to get off the ground. Deciding what model best fits your needs will help you determine the best site to reach your target audience.

Crowdfunding Resource:

While there are several other strategies you could use to fund your small business, these four are popular options for startups and master businessmen. Having a variety of options from loans, peer lending, credit cards and crowdfunding will create growth for your business and keep your small business fulfilling the needs of local residents. It may not be easy at first to find the best lending agency, but keep searching until the right place gives you the capital you need.


Thomas Steele Riverside, CA

There are lots of free info sites on the web. SCORE is a good one to start. Best of Luck


Nathan Haffke Omaha, NE

I agree with Mr. Ashe. Franchising is a great route. Build a business around a set of systems not around you. Surround yourself with the right people. You don't have to be an expert in all areas of business to be successful if you have the right organization behind you. There are a lot of good concepts to choose from, most of which can walk you through or suggest good financing routes.


Daryl Harrison Thurston, NE

First and foremost, so as to never be swayed from personal success you must define what your dream is. Success can be measured in several ways. How will you be able to measure your success on the road to reaching your dream ie. money, prestige, recognition. If you do what you love you will never work a day in your life. If your going to be successful you better do what you love. Because your going to be doing it 24/7/365. Short read: The Millionaire Next Door. Synopsis= They never set out to be millionaires. They loved what they were doing so much they didn't have time to spend it, unless it was so they could do more of what they loved. DEFINE

If you have this set in your mind, you are then ready to take advice. Without it you can be too easily swayed into someone else's version of your dream. Have a short "Motto" that consolidates your dream into a single sentence. Every time you have a decision before you bounce it off of your motto. Will the decision be productive or counter-productive to your cause.

Then find a SCORE mentor that is familiar with your type of business that likes to talk. FREE

Many states offer Small Business programs/training. Nebraska's will actually stay at your side for an extended period of time if you graduate from the program. CHEAP

Plan your work, work your plan. Evaluate, Adapt, Overcome.

Have fun


Stan Hines Fort Worth, TX

Personally, I know a local bank who's specialty is Small Business loans that are backed at 75-80% by the goverment. They make you put money down, so between your down payment and government backing, the bank has little skin in the game. If you search, you will find a bank who specializes in such loans.

Of course you can go the tried and proven route of a franchise business, but finding the one where most franchisers' make money is the key. The franchise reviews and contacts can be found online. No need to recreate the wheel.



John Zima Kutztown, PA

Todd - there is a lot of great advise posted here for you. I am a small business consultant, if you want to spend some time on the phone talking through all of this and some of your ideas, I would be happy to have the call. Let me know and we can connect.


michael convey Longboat Key, FL

I would suggest that you develop a Business Plan before you do anything. You will have to estimate the costs to start the business and what your ongoing monthly expenses will be. In addition, you will have to develop a sales and margin forecast. An analysis of competition must be determined, forecasting their sales and margins, if possible and then illustrating what will make you different. How and why will customers use your products and/or services as opposed to their current vendor. From here you can forecast your profitability. It is important that your information be objective and be based upon sound input. I suggest you contact SCORE, which is associated with US Dept of Small Business Adminsitration. They will help you prepare a Business Plan and assist you in finding local financing and/or using the SBA.

Mike Convey


michael convey Longboat Key, FL

When I started my business I went to over 20 institutions seeking financing.. All of them said no for various reasons. Finally, I met with someone from SCORE, and they suggested the Small Business Administration. I went to see them, and was pleasantly surprised. First I had to provide credit references, which were favorable, a resume listing experience, accomplishments and references. The experience illustrated I had experience in the field and success in my endeavors. SCORE then helped me with a Business Plan. The Business Plan does two things, first it forces you to analyze your ideas and objectively evaluate what you are trying to accomplish and determine whether it projects to be profitable. The second thing it does is prepare you for your interview with organization you are seeking financing from. They want to see your plan and will question you about the likelihood of success and how you expect to get there. Relatives and friends are another source of financing, and selling some of your assets is another way to acquire liquid capital to start your business


Joel Padua Aurora, IL

I know someone in your area that can give you an info. To start a business. Let me know if you're interested. You have nothing to lose but to learn


Richard Ashe Houston, TX

All of the responses and insights from the advisors are on point. I'd also like to recommend as part of your research into starting a small business to look into franchise opportunities.

There are thousands of franchises in different industries and at different investment levels. Franchising provides training, systems and process and coaching on how to operate a specific proven business model and provides a community of franchisees which can help in growing your business.

Funding a franchise, in many instances, are much easier than starting a business from scratch. Banks are much more comfortable loaning to franchises for three main reasons:

- There is less management risk associated with a franchise.
- There is rich historical data that the bank can draw upon about the success of franchises.
- The Small Business Administration (SBA) is much more likely to guarantee a loan to a franchise than many other types of startups.

Franchising is a good fit for veterans who understand both leadership and teamwork, know how to leverage a chain of command and know how to follow a SOP. According to PWC 2011 report on veterans in franchising..."the average veteran-owned franchise businesses compared very favorably to all veteran owned businesses, generating average gross receipts of $2.1 million compared to $445,487 for all veteran-owned businesses." There are franchises that offer discounts and incentives for veterans because they understand the value and skills they bring with them from their military experience.

As with all things there are both pros & cons associated with franchising and education is essential to help anyone considering investment to make the best investment decision for you and your family.

Due diligence is the key in selecting the right franchise. Seek out a mentor, ask lots of questions, read the documents, develop a business plan. All the steps that you would take in starting a business, as the esteemed advisors mentioned in their responses, are applicable with franchising as well.

There are no shortcuts, but franchising does help in answering some of the "I don't know what I don't know" questions about starting and running a successful business.

To learn more about franchising try these links:

Thanks for your service and God speed on your journey.



scott figura Atlanta, GA

I would meet with a representative at the SBA - U.S. Small Business Administration.
They are a government organization supported by retired business people that can help you define your goals and help to build your business plan.

Go to the website at

Best of luck.


Gerald Mannikarote Houston, TX

You can get a lot of answers by listening to podcasts. I have found a lot of free information there. I would suggest starting with Mixergy and The $100 MBA for the information that you are looking for.
I hope this helps!
Warm regards,


Michael McIrvin Mcpherson, KS

owning a small business many times can be much more rewarding personally and financially over just getting a job. I would recommend getting some experience in the field you are interested and then surround yourself with people in that sector. I actually made visits to people in my chosen profession. They were all generous with their time and gave many helpful tips that I put into practice.
Many businesses can be started on a shoestring. Sources of funding depends on your credit rating. I started my business with a low interest loan from a family member. If you go that route just make sure you both come up with a contract and stick to it. SBA loans can work. its a lot of paper work and they can be very competitive. In some areas of the country there are enterprise zones where a new business can apply for very low cost loans for startup, build out, etc. i am not sure if there are programs for veterans for this purpose, might be worth a look.
Bottom line in business - take in more than you pay out, and dont sweat the small stuff.
Good luck my friend


Jennifer Polhemus Santa Monica, CA

Two most common reasons for small business failure: lacks of capital & lack of management expertise. Get some honest feedback (i.e. from your critics as well as your friends) about how you fare in those areas. Consider getting more solid footing as an employee (with an enterprise that you trust) before going out on your own. Take your business idea and do a SWOT analysis & think of all the reasons to do it, and all the reasons not to.

Best success in whatever you choose!


Jwan Baughn Dallas, TX

You can also contact your local Small Business Development Center. The link below will help you find the center closest to you. I also listed a couple of other websites that maybe helpful as well. Wish you the best!!!




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