South-Western - Management  
In the money? Financing your startup can be tricky.
Topic Entrepreneurship, Finance
Key Words Entrepreneurship, Finance
InfoTrac Reference A115972071
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News Story

Entrepreneurs often face difficulties securing the necessary capital for their ventures. This article recounts what one entrepreneur, Duffy, had to do to overcome these hurdles.

First, Duffy spent the year before starting his efforts focusing on his credit, ensuring it would be exceptional. He could check the records by obtained his credit-score reports from all the credit agencies. As Duffy was looking for limited partners to provide the capital, he had to put together a thorough, solid and realistic financial forecast that met the investors' return expectations.

Until any deal was signed, Duffy had to secure funds for himself, his wife and the business. He decided to use his savings until he launched his business, while his wife helped support the family. Considering the psychological impact of creating a new business, they made sure not to overextend themselves, and scheduled time together every evening. Finally, Duffy hired a business coach Tim O'Brien, who instructed him to improve his appearance when meeting with potential investors.

Questions
1.

What challenges are you likely to face when trying to finance a new business?

2.

Do you agree with Duffy's coach?

Source April Y. Pennington, "In the money? Financing your startup can be tricky. Learn the steps this entrepreneur took to polish his image for investors." Entrepreneur, May 2004.
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