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5Small Business Capital - It's Not Just About the Money (Part 1 of 5)!

By Carrie Sharpshair
January 4, 2011

Back in 2006 I decided to sell a successful personal chef service and go into consulting. My friends, family, and peers were shocked. The business was built from scratch, was unique in my area, and I had established a trusted brand, yet I was ready to walk away! Why, you may ask? To me, it all came down to capital (or more specifically, a lack thereof). I knew that in order to take my business to the next level I would need a hefty infusion of capital.

When I really sat back and looked at my situation it wasn't just the financial capital that I needed. I realized that I also lacked sufficient emotional and physical capital as well.

That concept kept resonating with me as I began to work with individuals, small businesses, and grass roots non-profit organizations and saw how critical these additional types of capital are to a blossoming business.

Let's start by looking at emotional capital - which, to me, is the springboard for all business activities. I see emotional capital as the "why" you are in business; the "for whom" you are in business; and the personal inventory you bring to the table.

Why Are You In Business?

Everyone has their own reasons - maybe one or more of these resonates with you:

• "I need to make money."
• "This is what I know."
• "I love doing what I do."
• "So I can fund my philanthropic interests."
• "Because I have a great product and want people to use it."
• "I have a unique gift and want to share it with as many people as possible."
• "I am fulfilling my purpose."

Whatever your reason, it's important (especially when things take an unexpected turn) to remember "why" you are in business. I encourage you to revisit your reasons for being in business. Has your perspective changed over time? Does your "why" fuel your actions? Are your business goals and objectives in alignment with your "why?" If they're not (or - gasp - you don't have specific objectives outlined) take some time to outline a few objectives that are in alignment.

Knowing or revisiting your "why" is just the start - you need to look at the customers paying for your product or service.

For Whom Are You In Business?

Who is it that benefits from your work? I think this is where a number of businesses (both small and large) really struggle; I've done so in the past as well. It's one thing to go through the exercise of identifying a target market, a specific niche, and an ideal client based on both demographics and psychographics. The magic lies in the alignment of the "why" and the "for whom."

How aligned is your "why" and "for whom" right now? If your reason for being in business is to continue doing what you love; however, the clients you are attracting aren't ideal, then you are out of alignment and you should consider fine-tuning your approach. Maybe your reason is to make a certain amount of money, yet you undersell your abilities and find yourself being miserable. Take some time to determine if you are clear on your "for whom" and to determine how aligned you are. Now, it's time to take an inventory.

Am I (or Are We) Emotionally Equipped?

Desire, faith, and action are (to me) the foundational traits all entrepreneurs must possess; however, taking a personal inventory of other attributes associated with success will round out the evaluation of your emotional capital. Look at the following list and ask yourself how you (and your team if you have one) measure up: time management, money management, organizational skills, persistence, planning, follow through, achieving results, and decision-making. When we struggle in any of these areas it causes a drain on our emotional capital account.

Determine what's important to you and your business and take measures to either refine your skills or bring on the help you need so that you fulfill your "why" and wow your "for whom."

Emotional capital sets the foundation for developing and delivering your products and services to the highest degree possible. Getting clear on the "why" and "for whom" along with taking inventory of your success factors will help your business take root, blossom, and thrive!

About Carrie Sharpshair

Carrie Sharpshair is your thriving business planning mentor and the founder of Arboresque Coaching. She works with first time business owners, helping them balance their creativity and enthusiasm with a solid foundaiton for planning, preparation and performance so they focus on serving their customers. To find out how she can help your business take root and thrive, she invites you to apply for a strategy session via her website at www.arboresquecoaching.com.