The first four parts of this series of entrepreneurial questions to ask an entrepreneur focus on funding questions. You should never have to ask an entrepreneur one of these difficult questions during the funding process, but I will. The fifth and final part of this series of entrepreneurial questions to ask an entrepreneur focuses on questions to ask an entrepreneur about his or her personal life. So be prepared to answer questions about your siblings and ex-spouses. The final part of this series of entrepreneurial questions to ask an entrepreneur covers questions that are more general and can apply to other investors.
The questions to ask an entrepreneur in this series are
What are your personal investments?
One of the best questions to ask an entrepreneur. This is probably one of the most difficult questions to ask an entrepreneur. Usually good entrepreneurs will have a list of their personal investments made by friends, family, and other investors. Be prepared to do some digging to get numbers that reflect your own investments.
How much cash are you raising?
This is a question that you should ask any new investor before committing to their financing. If you cannot provide numbers then you should not proceed. In most cases you will need to provide a rosy picture of your future business based upon current and future revenue and expenses. A capital increase will give you a better chance to meet those future milestones.
What types of loans or business bank loans are you seeking?
These questions to ask an entrepreneur about his or her financing options can vary greatly depending upon your goals. If your business is just getting started, you may not want to stress too much over questions to ask an entrepreneur about his or her financing options. In that case you will probably want to consider working with an experienced executive coach or business mentor. That can offer you the necessary help to navigate the financing maze that often accompanies a start-up.
However, if you have already begun your business venture and have completed several significant milestones, you will likely want to dig deeper into your entrepreneur questions to ask an entrepreneur about his or her funding needs. With one of entrepreneurship questions you should find out what type of commercial mortgage or capital loan you need in order to move forward with your business plan. You may be able to secure your investment through your existing commercial mortgage lender, which can often provide you with a more reasonable interest rate and terms than many private commercial lenders. Alternatively, you may want to consider looking for a small business finance or small business bank loan.
Are you planning to expand your business?
Your questions to ask an entrepreneur about his or her financing options should focus on expansion.
3 questions for an entrepreneur:
- Do you have a plan for how you will acquire additional office space, equipment, or space to hire additional employees?
- Is there a way to reduce your start-up costs so that more of your profit can be invested in marketing and promoting your new business?
- If not, are there ways you can reduce the impact of these additional financial expenses on your business?
How do you plan to manage your day-to-day operations?
This is one of the questions for entrepreneurs. As your business grows, will you need more space, equipment, or workers to help you meet your expanding workload? Are you currently planning to outsource some of your critical tasks or services? These questions to ask an entrepreneur about his or her financing options should focus on cost management. Are you paying too much in labor and overhead to manage these tasks in-house?
If you follow these general questions to ask an entrepreneur about his or her business, you will likely come away with some interesting information. Find out how you can get additional help with areas you do not understand. Get ideas for how to turn your business goals into reality. And above all, learn as much as possible about how an entrepreneur operates his or her business so that you can avoid making the same mistakes.