Imagine we were in a room full of small business owners and we asked them all one simple question. “What is the one thing your business needs the most to survive and grow?” You’d get a variety of answers. “A product or service people want.” “A large number of loyal customers.” “A solid business plan.” “A prime location.” “Effective marketing.” All of these answers are true. But there is one need central to every business: the need for available cashflow. Cashflow is the lifeblood of any business. Without money, no business owner can keep their doors open.
Keeping The Engine Running
Cash to business is like fuel to a car. You need to have enough in the tank to start the engine, and you need to maintain enough in the tank to keep it running. Only when there’s enough fuel, the car (your business) will take you where you want to go. If you run out of gas (available cashflow) at any point along the way, well… we all know what will happen.
Where can a business owner get the cash he or she needs? We often look at external sources. Banks, venture capital, private funds of the owner, friends, and relatives are common places to look for money. But banks usually want at least two or three years’ worth of business financials before they’ll give you a loan. Venture capitalists want to take part ownership of the business. I love watching Shark Tank (or it’s Canadian version Dragon’s Den).
What do you do if you don’t want to give up any equity? If you’re not in business long enough you can also forget about most banks lending you money. And with your private resources already tapped, you may be stuck. “Where can I find that cash to grow my company?” In my Millionaire Mindset experience, I address these questions. Below, I’ll share one of the possible answers. Albeit conservative (I’m Dutch after all), you’ll find this time-tested approach will allow you to scale almost any existing or new business venture.
Instead of looking at external sources, look internal. I’m a firm believer in re-investing money into the business. I re-invest money that’s generated by the business itself, into the business. It leverages the companies growth without creating unmanageable financial risks. If you wish, you can scale any business without adding debt, or giving up ownership. It’s an often slower, more conservative approach to business growth. The good news is there are no loans to pay off. You create and keep a cleaner financial statement. Your access to cash grows organically with your business sales. If implemented well, you can setup your business so that it runs with virtually no overhead this way. Even in times of economic downturn with less (or no) sales, you can continue to keep your business going. Ultimately, this puts YOU in control. And that’s what my Millionaire Mindset experience is all about: adding additional financial options to your life. Click here to learn more.