Financing Your Home Business

The 5 Things Every Company Must Do When Seeking Capital

- Murray D. Schwartz Partner, Warshaw Burstein, LLP, New York

In my practice working with startup and growing companies, the first and most important question I am invariably asked is: How do we get financing and on what terms? Since being undercapitalized is the death knell for startups and not a good thing for any company, it is an issue which needs prompt solving. As any realtor will tell you, when selling a house it needs to be “dressed for sale.” Fix the leak in the bathroom, patch the roof, add two coats of paint, replace the dead azalea and be sure the pictures on the internet show off the home to its best advantage. Now you are ready for the market. When dealing with the financial markets, advice from onetime Giants football coach Bill Parcells comes to mind: “When you get to the end zone, look like you have been there before.”

So how do we get ready to “sell” the company to a lender, angel investor, private equity company and even to an IPO underwriter? The principles are the same. You need to make sure your “house” is in top shape first, by examining and preparing the following: