Business Plans

Whether you are an artist looking to distribute your music through your own label, an agent, a manager, or looking to start your own label, it’s important to have business plan. And just so everything is clear and communicable. You need to put it into writing. If you’ve ever seen a show called “Shark Tank”, then you have no doubt witnessed the brilliant and blunt attitudes of my favorite entrepreneurs Kevin O’Leary and Robert Herjavec.

Kevin O’Leary started with nothing and developed software that teaches reading skills to children. As the business grew, O’Leary eliminated the competition by buying them out. He later sold his company to Mattel for about 3.7 billion dollars.

Robert Herjavec made his money by building and selling tech companies. His first company, BRAK Systems, was sold to AT&T for $100.

Both investors look for the same things that all angel investors look for.

Focused Money Source

They want to know where the cash is coming from. It’s important to be specific. If you say your going to make money from “probably here, and sometimes there, and maybe somewhere else also”, then you aren’t going to have much luck attracting investors.

You need to clearly define a concentrated revenue source. The simpler you can keep it, the better. Unforeseen setbacks will complicate your business enough, don’t add to it by having a plan that isn’t well thought out and focused.

Numbers

Do your number make sense? If your claiming a $20,000 a year profit from a small side business, and your not paying yourself. What’s going to happen when it becomes your full time business and you begin paying yourself? Then you don’t have a profitable business.

Are you asking for a $100,000 investment for 25% equity in your company? That means your company is worth $400,000. If it’s not, then your request is unrealistic and you’re not likely to be taken up on that offer.

Your Market

Do you know your market? Do you haven any competitors? If so, do they have the ability to drive you out of business as soon as they begin seeing you as a threat? Did somebody else already have your idea and patent it?

These are all things you need to know BEFORE you try to get your business off the ground. If you haven’t thoroughly researched these ideas why would anybody feel confident investing your company or much less you as a leader?

Conclusion

These are all points both O’Leary and Herjavec bring up repeatedly on “Shark Tank” and it’s important to take the advice of those who have been there before and been successful.