Written on May 06, 2010 | by Michael Harris
Raising seed capital in this day and age is a difficult task at best. Not only will this be obvious to anyone who has tried to approach their local bank for help to do so, but the waxy smiling figureheads of each political party have been spelling out the issue to everyone who’ll listen and pointing the finger of blame at one another these last few weeks.
Small business funding has been hit hard by this recession but the rules of raising seed capital are still the same as they ever were. You must have an excellent concept, be able to prove that the venture has prospects and equally be able to clearly capture the essence of your investment opportunity in a single concise document known as a business plan. At first glance this seems not that dissimilar to the experience a political party has in the lead-up to an election and the importance of creating a believable manifesto that will encourage you and I to invest in their vision for the future.
As a manifesto is defined as, “a public written declaration of principles, policies, and objectives,” it sounds very much like the description of a business plan, with one rather important difference ¬ – people don’t believe manifestos. It’s really very simple. You know the old saying, “fool me once shame on you, fool me twice shame on me”, well, manifestos are a little like this.
If you’re raising seed capital it is essential that your business plan is believable, not only in its financial forecasts but also in its rhetoric. Everything you say in this oh so important document must be credible. Strip out the jargon, the flowery language and the bull, and leave only good honest believable information tinged with passion and conviction.
Generally speaking, investors will believe a business plan that presents a good argument. But political manifestos are a different matter altogether. Helped by the blatant abuses that were highlighted in the recent expenses scandal, we just don’t seem to trust politicians very much in this country. So when a politician sets out their policy promises in a manifesto we have to look at the document with a healthy amount of scepticism. After all, we know that once in power, a politician has the absolute right to completely ignore anything or everything in this document. So why oh why do we still base our voting decisions on a document that only has to “look” convincing, but that we know in our heart of hearts is going to be dropped like a hot coal as soon as it suits them to do so?
Raising seed capital for a business is a serious affair; it relies on trust, dedication and conviction, three traits that politicians would do well to take note of from the business sector that they are supposed to be serving.
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