One of the most interesting websites we’ve discovered recently about entrepreneurs is called Under30CEO. Today the site featured an interview with Trevor Mauch, founder of AutomizeIt and Mach One Media, serial entrepreneur and founder of a few multimillion dollar businesses. Excerpted from the interview is the quoted section below:
One of the things I see a lot of people I’m coming across, they’re making the funding part (of entrepreneurship) out to be a huge deal [when it’s not.] As a great example…this guy was selling his linen [or garment] business services for hotels or whatnot. He bought his equipment for 500 bucks. And this guy bought this equipment, and then he went to the biggest account in town, which is our local hospital and said “what do I have to do to have your business?” (After he heard the answer,) ..he said “okay, I can’t do all of this capacity right now but if you fund $25,000 to get into a facility and to buy our equipment that can service ..what you need, then will accept this bid.” …The hospital..it’s like (a) $15,000 – $20,000 dollar a month account! ..The hospital ended up going with this guy and funded the whole growth of his business!
..With two of my different businesses, …we saw what people wanted, and we went out there and pre-sold one of our training programs before it was ever created! We made sure that people wanted it, made sure it’s really quality, and we pre-sold to our customers, and our customers funded that startup. And same thing with our software company. We funded that company with our revenues from the publishing company, and same thing we went out there before we were finished. We pre-sold memberships in it and that help us get some cash to start that goal. So yeah definitely don’t look at funding as an obstacle because there’s a lot of different ways to get funding, especially from your customers, and sites like Kickstarter.
(At Kickstarter) anybody can go there and post their project, their business or products whatever their looking at launching. And they raise funds for their business by getting people to “pre-buy” whatever it is. So, I was last week and uhmm there’s this one [business], that was some kind an iPod speaker and so they had a prototype…they sold a prototype and said “that’s what you’re gonna get,” and they had a goal they wanted to raise, I think that one is about $50,000 bucks. And they raised their $50 grand in about 14 days after they started, just from people seeing this idea and jumping pre-buying one of the things from it!! And that’s just a killer model.
So, the moral of the story is…become creative in your approach to funding your business! It’s not necessary to run up exorbitant credit card debt, nor follow the angel-VC-dilution pattern. Mauch started his first business with $600 cash. Stretch your mind–think hard about how you can accomplish your objectives without copying someone else’s success path. You will be so happy you did when it’s your turn to be interviewed.