Goindocal: Ideate…Innovate…Implement, this combination of 3 i’s is at the root of all successful entrepreneurial ventures. Any kind of ignorance of any of the ‘i’ could result in setbacks if not failure. Changing human needs offer newer opportunities for entrepreneur to explore and guide them to find solution for those changing needs.
Technological innovation was and still is at the core of industrial growth, however in this era this has been more advance and fast. With over 7 billion population and half of them in younger age group, any good idea serving the need of the highly diversified mass could find takers and become a big success story.
Opportunities are there, Ideas are there…but the biggest question is how to germinate that idea into a reality. The answer is simple, make a stage-wise plan so that you could act upon them and implement them smoothly. Unfortunately, this simple answer is not so simple, as it looks.
Once you are in post ideation stage, meaning you are ready with your idea, you need to find ways how to shape this idea by using all possible innovative tools available. Innovation should always remain at the center, so that your product or service should give feeling of freshness and truly remain simple.
The biggest challenge any breed of entrepreneurs face is mobilizing funds for the venture. Idea is perfect, it is innovative and you think it is path-breaking, but the mute question is, will it make inroads in minds of consumers and impress financiers equally?
If your idea have the potential and you are confident enough to deliver it in desired manner then consumer satisfaction is not an issue here. Biggest challange is how to channelize capital. Even if you have managed to mobilize funds initially, at some stage you will need help of investment banks, if not to start then to scale up your business. Investment banks channelize capital based on clients need; let’s see why you need them:
Confidence Builder You are the man behind the idea and you have a well developed plan to make it a success story. As every business idea needs capital, your idea will also require consistent funding proportional to your growth strategy. But raising capital is a tricky game. Investment banks help you in winning this tricky game of raising capital. Investment Banks are more like your “best friend” and who guide you through the process, so that you could pick right partner and define terms and conditions properly. As investment banks take complete responsibility of managing capital for your business plan it allows you to focus more on your business and move ahead with confidence.
It has been commonly observed that innovative brains do lack skill to make formal documentation. In this world of legalities and perfection one needs perfect presentation of business idea to make it real. And, investment bankers are master of this art of documentation.
A good investment banker helps you in preparing a business plan, with all possible details of business, idea, the product or service, market potential and growth strategy, so that you could make memorable impression upon investors. As most of private equity players and venture capitalist love to delve into details with data support, Investment banker do this work for you and that with perfection.
Except those who are into finance, some questions like, what’s the bottom line? Future projections? What is the EBIDTA margin? Break-even time-frame? What is the ROE? What is the IRR of the investment? makes non-finace guys uncomfortable. But, you need to have answer for all such questions and investment bankers find answer for you. They give shape to the business idea into numbers and build a financial model that best summarizes the business opportunity and the expectation from the investors.
Understanding the legal complexities of business is not everyone’s cup of coffee neither one needs to that. Investment bankers with experience of multiple transactions understand the nitty-gritty of the distribution of rights and obligations between the entrepreneur and investors. One need to involve a corporate lawyer for preparing the legal documents but it is always advisable to involve the investment bank in the process for better coordination.
Investment bankers are better negotiators as compared to lawyers and they understand the need of both sides.
Investment banks explain the key terms of the agreement to entrepreneur so that they could reach decision in most effective manner.
Everyone has a specific role to play in a success story and as an entrepreneur one needs to understand the characters well and direct accordingly. Raising capital needs a focused approach and investment bankers are master of that art, which they gain through experience. Investment banks manage a network of investors and match their requirements with that of entrepreneur’s need, making it easy for entrepreneur to raise funds.