One of the biggest questions new entrepreneurs have to answer is how much initial capital they will need to invest. The question should really be phrased in terms of six-sub questions pertaining to the words: who, what, where, when, why, and how. After answering these questions the entrepreneur will be much better equipped to manage their money and achieve future prosperity and success in their business endeavors. In the big picture how much money an entrepreneur requires to fund their business is contingent on the market itself (what), who they are selling to, and who is investing in their company. Here, the amount of funding needed is affected by numerous factors so the business must always maintain a frugal attitude concerning its spending habits. Like many things in life, sound money management leads to a successful launch, whether it be a career or starting a new business.
How much is just right?
Like the average consumer, whatever one typically has on hand they will spend. The analogy of teenagers spending all they have at the mall pays credence to this raw reality of the business world as well. The more money a business has, the more opportunities it has to potentially waste that money on frivolous pursuits that detract from the mandate; increasing revenue through the generation of capital. Therefore, seeking too much money initially may be a hazard to the financial health and subsequent success of one's business endeavor. Practicing discipline is the key here, because although the amount of money up-front may appear large, the initial sum will certainly decrease as time progresses. On the contrary, the problem with seeking too little initial capital for a start-up comes with its obvious complications.
Staying Motivated
Motivation leads us back to consider one of the first initial questions pertaining to “why”? The reasons surrounding why a business requires funding usually pertain to the personal goals of the individual entrepreneur in the first place. Without delineating into a slippery slope of questions that ultimately do not have answers, such like the child continually asking the parent “but why?” and frustrating the parent, the question “why” pertains to what a business is all about; the free creation of wealth and the pursuit of the good within our liberal economy. Therefore, when entrepreneurs face numerous rejections from investors they should not give up and cast away their ambitions so easily. There is money to be made by all interests, and the investment pool is no different. If entrepreneurs let these little bumps hinder their view of the good then they will likely face defeat, and the crumbling of their business in future conditions. When the going gets tough the tough get going. If one is not prepared or does not have the desire to pitch to hundreds of investors to get their business going then they might not be in the right business to begin with. Business start-up requires tenacity and a dedication to the dream and vision the entrepreneur has laid out in their business mandate. Keeping the eyes on the prize will both figuratively and literally pay off in the long run, and the investors begging to give the business their money will verify that.
