Can You Tell Your Business Story? Obtaining Financing!

Do you have a thriving business but struggle to secure financing? Is your business story straightforward, or is your business intelligence lacking?

The Power of Storytelling in Business

Storytelling is a powerful tool in business. It’s not just about numbers; it’s about weaving a narrative that showcases your journey, challenges, and triumphs. A compelling business story can make all the difference when seeking financing.

The story starts with your profit and loss statement.? One of the most common complaints from owners of small and medium-sized businesses (SMBs) is that their profit and loss statements show a profit one month and a loss the next. They know they’re making money because they can pay their bills, but the problem is cash-based financials. GAAP-based financial statements reveal the actual income trend. GAAP accounting is Warren Buffet’s preference, and it should be yours, too, especially for lenders and investors.

Can you explain the costs and gross margins of your products or services??Understanding where your profits come from and whether they’re sustainable is crucial. This forms a vital part of your business story.

Can you describe your customer base and total addressable market (TAM)??Lenders and investors want to know who you’re selling to and your target market size. Provide descriptive metrics such as your top 10 customers and demographic information (location, industry, income levels, or size). Do you have recurring sales, or what is your subscription cancellation rate? These details add depth to your narrative.

Describe your cash flows.?What are your sources and uses of cash? Lenders need to know how you’re managing your money. Is it coming from income or financing? Are your business investments in tangible assets? Are you paying down debt, or is it increasing? How are your relationships with your vendors? This financial story is crucial for building trust.

Lastly, what are your forecasts??Everything up to this point tells the story of where you are now. Where are you going, and what will that look like? Will the lender or investor get an adequate return on their money? Your vision for the future completes your business story.

Crafting a compelling business story is essential for obtaining financing.?It’s about more than just numbers; it’s about presenting a straightforward, cohesive narrative highlighting your strengths and potential.

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As Kevin O’Leary from?Shark Tank?says: “My partners… taught me that in order to create wealth, I needed to pair up with people whose strengths compensated for my weaknesses.”