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If your New Year's resolution for 2015 is to work on your business (not just in it), look out for our daily online posts that get you thinking differently about an aspect of your business.

For the month of February, our daily challenges will be all about 'Funding Your Idea'!





Day 1:         Is your idea worth funding?

We would all like to think that we have discovered the next big thing, but are you or anyone else prepared to fund its development?

Today's challenge is to critically evaluate whether it's an 'investable' idea. There are a number of tools to help you do this, such as our BizLab tool. Not being prepared can mean investing a lot of time and money in an idea that's not going anywhere.


Day 2:         What are the funding options?

Do you know the difference between organic growth; grant funding, debt funding and equity funding? There is a lot of information about each of these online. Today's challenge is to get informed.


Day 3:         Why go organic?

One of the most common reasons businesses fail in the early days is growing too fast (sounds like an oxymoron right!), but they fail due to lack of cash flow. Growing organically or investing your own earnings in the business means you get to control the rate of growth. Today's challenge: Is this the best option for you?


Day 4:         There is no such thing as free money!

A lot of people believe that the government has a role in funding their start up – think again. There is some government funding available but it is limited and the competition for it is high. These funds come at a cost – your idea needs to fit in with the policy focus of the day and you need to spend money before you get any back.

Today's challenge is to do some research and see whether you fit the criteria and whether you can meet the obligations.


Day 5:         I've decided to apply – now what?

If you have decided to apply for government funding, the first thing to do is read the questions carefully (sounds like a strange thing to say but this is the biggest complaint we get from government case managers).

Tell a compelling story about your idea in as few words as possible – this is your exercise for today. If you don't know where to start get in touch with us and we can take you through the options.


Day 6:         What about debt?

This usually scares people – but debt comes in all shapes and sizes and you should be aware of all of them. The 3Fs (aka family, fools and friends) can provide small, friendly loans; banks through personal loans and lines of credit; purchase order financing; microcredit loans offered by organisation like Lighthouse.

They all have eligibility and repayment criteria, spend some time today reading up on your options.


Day 7:         Will an investor speak to me?

Investors also come in all shapes and sizes, but they all want the same thing – a return in as short a time frame as possible. They do this by taking equity (or a share) of your business and this is based on the value of your business.

There is a lot of confusion about how you value your business – but one thing is clear – it's never worth what you think. Today's challenge: What's your business REALLY worth?


Day 8:         So what's the pitch?

Any pitch to investors has to cover some key elements: your story, the market problem (or pain) and your solution to it, your success, the target market, customer acquisition strategy, your competition, the revenue model, financial projections, your team, what do you want ($) and your exit strategy.

Today's challenge is to read up on these and start pulling together some dot points under each heading.


Day 9:         The Elevator Pitch

There are two classic sayings in the investment world – if you are in an elevator with Richard Branson what would you tell him about your business between the 1st and 7th floor? And if you can't get your grandmother to understand your idea – no one will.

Today's challenge is to work up a 30 second 'pitch' of your business and try it out on a few people. Take all the feedback on board, both good and bad.

If you're interested in finding out more about the pitching process, come along to the Capital Angels Raising Money Masterclass on Wednesday 4 March to see pitching take place.


Day 10:        What else do investors want?

Investors are really investing in you, so make sure you can tell the story and are ready to take the feedback. They are looking for an honest story that you can support with evidence – they don't like fairy tales (they hear 'we are going to change the world' pretty much every day).

They want to be involved with your business - in fact they will take a big slab of it in return for their money. Today's challenge: What's your story?


Day 11:        The pivot – don't be too married to your idea!

"To improve is to change; to be perfect is to change often" - Winston Churchill. One of the most important decisions you will have to make is to know when to stay the course versus when to change direction. There are many examples of this: Twitter, PayPal, Groupon and Instagram. Read up on these today and make sure you understand the concept of the 'pivot'.


Day 13:        How do your investors get out and when?

Equity investors want to know when they will get their return on the investment in your business. The task for you today is to think about the options – trade sale, founder buy back or IPO. Are there other options?


Day 14:        What about you – how do you get out?

If you have decided that you are going it alone (maybe with a bit of debt or government financing) how are you going to get out of the business? Not many of us want to work until we are 90 so how do you extract yourself from the business? Do you sell it, do you kids take over or do you shut it down? Have a think about this.


Day 15:        Growth Strategy

Okay – so you have your idea worked out and there seems to be some interest in it, how do you scale up? How do you grow the business? Some businesses will employ one person and others over 100 people, they are both good business but they have very different growth strategies which usually relate to generating income. Today think about your objective for your business and how you are going to get there.


Day 16:        Your competitors – and you do have them!

Complementary and substitute products, direct and indirect competitors. These will all impact on your business and you need to be able to identify them all. There is a lot of information available that will help you figure out where you fit in the market, have a go at drawing up a table that compares your product to what else is on the market.


Day 17:        The Team!

Who is the team? Not many people, other than the bank who wants your house, will fund a one person band. If you can't employ people right now spend some time today thinking about the type of skills and people you need to make up your team. Remember the focus is on growing a sustainable business.


Day 18:       Be open to feedback – positive and negative!

Nobody likes a know it all – not the bank, government or investors. Today's task is to make an honest list of your strengths and weaknesses and build that into your practice pitch. Feedback will be invaluable so always be open to it.

One of the keys to success is to build a team around you that bring the skills you don't have. It is good to have a HAG (hairy audacious goal) just be ready for people not to agree with you.


Day 19:       The Board and Working with Investors

We all have task masters and if you take on investors you will have a few. There is a lot of information on the internet about people's experiences with investors. Take the time out to read some of this today. You might also want to read up on the challenges and benefits of working with a Board. You might end up with a Board even if you don't take on investment. Corporate Governance is not an exciting topic – but it is an extremely important one.

Day 20:       The Founder's Syndrome

None of us want to think that our business has outgrown us, but it does happen. Many companies struggle with founders (the people who started the business) hanging on when they no longer have the ability to grow the business. Investors will do everything they can to cut these founders loose.

How would you feel if you were in this position? What would be acceptable options to you going forward?

Well done, you've completed our February Challenge!


For some helpful advice, visit the Lighthouse Facebook page for online articles and resources to help you complete the daily challenges.


About Lighthouse Business Innovation Centre
Lighthouse has a strong track record of supporting entrepreneurs, researchers and inventers on the path from concept to commercialisation. Since July 2008, Lighthouse has worked with over 990 distinct enterprises and provided group and peer based services to over 3400 enterprises and individuals. For over five years Lighthouse has successfully delivered business advice, education, mentorship and networking opportunities to help these businesses commercialise their ideas and grow their companies. Lighthouse also delivers programs such as the ACT Microcredit Program for the ACT Government. Visit for more information.