5 Entrepreneurial Finance Tips

By Ain CFE Staff

“Entrepreneurs are risk takers, willing to roll the dice with their money or reputation on the line in support of an idea or enterprise,” claims Victor Kiam. Innovators have to be ready to take a leap of faith to make their ideas into reality. While hard work and a great team can help get them on the right track, financial backing can make the process easier and more secure. On February 26, Jack Greco ’06, ’08S spoke to students about his background in VC and how to assess different avenues of funding, as well as the factors/stages in the financing process.

This session was the second installment in the 2019 Mark Ain Business Model Workshops. These are held to help prepare students for our upcoming business plan competitions (though these informational events are open to anyone and everyone!). The Mark Ain Workshops build on the more soft-skill-focused Foundry Forums held during the fall semester. Below are 5 key points drawn from the event.

Know Your Options

Equity. Grants. Bartering. Donations. The channels for financing are almost endless, but it's likely that some will fit your needs better than others. If you understand what certain investors want from an interaction with you, you already have an advantage. Ask yourself, "what is their incentive?" Recognize that people want different things and tailoring your asks is important to getting what you need.

Build Relationships

At various points throughout the workshop, Jack mentioned that funding is often not just about money. Behind the fear of financing is the human need to connect - many investors want to know you in order to build a foundation of trust and transparency. He also stressed the importance of honesty: when Jack pitches, he begins with the challenges faced by his project. If people can get through that "hard part" and still want to know about the rest, he then shares what makes his venture promising. It's a risky tactic, but can be more rewarding than trying to hide the not-so-stellar aspects of your plan.

Provide a Clear Vision

Why are you working on this venture? Explain what you're doing and why - and be prepared to talk through each step of your plan. (Writing a business plan can help here - check out our "5 Business Writing Tips" blog for more info!)

Start Early

It's never to soon to start learning about the world of VC and entrepreneurial finance. Jack was 23 when he began in the industry and, while he acknowledges that learning lessons and fast failure can be painful, he is glad he began to pursue this avenue early on. Additionally, he argues that starting at a young age helped him realize what to take note of when working to build your venture (including time spent fundraising, resourcing, and how to pitch).

Face Time and Creativity are Fundamental

For new founders, Jack recommended talking with at least 10 established founders to gain insight and feedback. Those moments of face-to-face contact are irreplaceable; anyone can send an email, but making time to sit down with someone can be the difference in significant funding and no funding. Finally, and most importantly, Jack encouraged attendees to be creative in pursuing what they want. Leveraging networks, going to industry hot spots, and hoping for a little bit of luck can help even the most inexperienced entrepreneur begin to make an impact.

If you have any questions about locating funding or learning more about any of the topics discussed during the workshop, please contact the Ain Center at AinCFE@rochester.edu or meet with one of our Experts-in-ResidenceInterested in attending future Mark Ain Business Model workshops? Head over to our Events Calendar and register online!