Worcester Business Journal

www.wbjournal.com January 18, 2016 • Worcester Business Journal 27 www.empowering-women.biz Thursday, March 24, 2016 1:30 - 7:00 pm Center Road Dudley, MA NEW TIME Come join us to: • Gain inspiration and motivation • Enhance your leadership skills • Attend development workshops • Enjoy boutique shopping • Network with area professionals Featuring keynote speaker Adrianne Haslet-Davis Ballroom dancer and 2013 Boston Marathon bombing survivor Register Today! R E F R E S H M E N T S I N C L U D E D 20 $ 20 $ EARLY BIRD T O A T T E N D IF PURCHASED BY JAN. 31 *$10 for ALL college students Thanks to our generous Inspirational Level sponsors: The 2016 keynote speaker will be Adrianne Haslet-Davis, the incredible ballroom dancer and survivor of the 2013 Boston Marathon bombing. Haslet-Davis is a former Fortune 500 corporate manager who now speaks to audiences about her experiences, and moving past tragedy with resolve, strength, and determination. > Dexter-Russell, Inc. > Hometown Bank > O'Connor & Co. Insurance Agency, Inc. > Prudential Insurance Co. > Webster Five Bank Please visit our website for a list of all our wonderful sponsors. 2348NC16_EWIB_AD_9x6_2.indd 1 1/6/16 2:52 PM Capitalizing growth in 2016 T he New Year is upon us; optimism abounds, and there is usually an overriding belief that it will be a strong growth year. As many of you know, growth can be a stern taskmaster. Growth requires more of everything, including time, resources, energy and especially money. Every business at some point needs money, whether it is in a startup mode, financing growth or just overcoming a rough patch. For startups, the expectation is financing is self-funded. Jobs and Wozniak started Apple in a garage; Gates and Allen sold computers out of their house. The transition from self-funding to other people's money is usually a function of proven capability matched with opportunity. It's at this juncture that many small businesses either fail or just stall out. Lack of capital is frequently cited as the cause of a business failure in this early stage. If truth be told, it is not the lack of capital that caused the business failure. Rather, it is usually a poorly advised venture or lack of owner skills that precipitates failure. The inability to properly capitalize the business is merely a symptom. To avoid the symptom of poor capitalization, know who you are and where you are going. Successful business owners have an understanding of financial issues and financial planning. Foundational to this is the business plan and cash flow projections. These two tools reflect historical performance (if it's an existing business), and future projections based on market knowledge. Successful business owners know their markets and their customers. There is no guessing as to why customers buy; there is intimate knowledge of customers supported by strong relationships with those customers. Relationships and knowledge translate into increasing revenues and even more customers. Whether starting out or whether the capital is needed to finance growth, be clear on the requirements. Know what the money is intended for, and more importantly, how the money will make the business more successful. Once you know this, you then can determine how much money you need for your purposes. So as you look out over the next 12 months, be clear on your goals and expectations. Clarity of thinking and planning is a very enticing characteristic for an investor. Every investor knows their capital is a tool. The investor wants to use the tool wisely. Investors, banks, angels or other sources of capital are not looking to fund just the entrepreneur. They are looking for two things: 1. To fund a viable venture that is poised for growth, and 2. To know the venture is mobilized and driven by a capable entrepreneur. The hope of the investor is that by funding a viable and growing venture, their capital can be used to produce premium returns on the investment. The entrepreneur's job is to prove the case that the premium returns are not only possible, but probable. Cash is king. Proper capitalization can drive growth. The entrepreneur's task is to prove that the growth of the business is attainable, sustainable and profitable. If that can be done, then there are sources of capital to help businesses get to the next level and make the next year very profitable and successful. n Ken Cook is the co-founder of How to Who, an organization focused on helping people effectively build relationships and building business through those relationships. Learn more at www.howtowho.com. THE RAINMAKER BY KEN COOK "To avoid the symptom of poor capitalization, know who you are and where you are going. Successful business owners have an understanding of financial issues and financial planning."

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