Why supporting entrepreneurs and communities are essential?

Trade Financing Matters welcomes this guest post from Grace Leung Shing, CEO of Startwise a revenue-sharing crowdfunding platform that help individuals realize dreams, build companies and support communities.

Entrepreneurs need your support because entrepreneurship is an incredibly hard journey, if building solutions, creating a go-to-market strategy, sustaining sales and other complex situations were not enough to lead to many sleepless nights, fundraising is a full-time job on his own. Here is one of the common rollercoaster journey of Mary, an entrepreneur in the consumer retail space.

Vision to product

Eureka! Mary has an idea about a product and decides to create a few samples. She decides to use her savings to get the first production batch but it turns out that she needs some additional capital. In a heartbeat, she takes a zero interest credit card debt. She gets her samples made, gets some feedback and even manages to successfully sell the first production batch. The moment those first dollars are in her bank account, it’s an amazing feeling that has a slight taste of victory. Now she needs to make more products as demand is growing and people are excited about it.

Engaging her network

She wants to increase her production capacity and to accomplish this she needs some additional capital. Her good friend advised her to try crowdfunding, she also heard that rewards based crowdfunding is a good option [Kickstarter and Indiegogo]. During her campaign, she engaged her friends and family to participate and gave them in return some cool t-shirts and even pre-sold some of her products. It was a total success, she even fulfilled her orders on time.

Going to the local banker

The demand for her product is booming and Mary has so many ideas to create new product lines. It should not be that hard for her since she has been a good and faithful customer to the local bank and after all, she has revenue and customers. Unfortunately, the bank rejects her application for the loan – it prefers more established businesses with more cash flows and asks her to come back later. She could potentially go back to rewards based crowdfunding but fulfillment was cumbersome and most of her network already owns her products. What should Mary do now?

Angel from the sky

Tim – one of her good friends – suggests her to find an Angel to invest in her company. She got some introductions and met with some potential investors. During the initial meeting she was slammed with a number of questions 1) what is your traction? 2) What is your exit strategy? 3) Who are your competitors?

From her initial victory, she now feels like a fallen angel. She has a couple of hundred thousand dollars in revenue but she cannot seem to find the adequate capital to expand her product line and production capacity.

Us as consumers, we often forget or don’t know the struggles of the entrepreneurs who gave us access to some awesome products or services. We all like those local, clean, organic shops and coffee places – we trust their product and owners who put their heart and soul into what they sell. We see – and feel – how they change our own community and neighborhood for the better: bringing us more choices, creating jobs and always greeting us with a smile.

We could all become part of an amazing change by voicing our values, purchasing their product and investing in them. Let’s fuel the small business economy by supporting our local entrepreneurs.

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