What do you need to know about funding for your business in light of today’s economic uncertainty? On today’s Small Business Show, we’re joined by Ellie Diop, the Founder of Ellie Talks Money and the CEO and Founder of Ellievated Academy, to tell us more.
Accordion to Diop, “Funding is changing, and there remains a gap between women-owned and minority-owned businesses that typically dont receive as much funding as they should or what is readily available.” Sometimes, the challenges small businesses face comes from needing to look in the right places. “Most small business owners don’t know how to structure their business properly, nor do they know the importance of having a solid business plan.”
Diop encourages every business owner to look into their primary destination for financing. Which would be their CDFIs or their community development financial institutions. CDFI funds foster opportunities and economic growth in some of the most underdeveloped neighborhoods. The funds support mission-driven financial institutions that use a market-based strategy to aid economically underserved communities by providing specialized resources and cutting-edge initiatives that deploy federal and private sector funds. Meaning, CDFIs are placed throughout different cities and states, to ensure business owners have access to funds that aid in scaling their businesses.
“There are roughly one million dollars that go unclaimed each year. Which is simply from candidates not applying.”
Additionally, Diop emphasizes that the more business owners work on becoming fundable, the more they’ll find their success in funding will increase. This is how she developed ‘Getting Fully Funded,” which includes the primary factors that will help business owners become fundable. Those factors include:
- Establish a clear organizational structure for your company. According to Diop, companies need basics. They also need to verify their identity and set up a payment processor.
- Make sure you have a strong business plan. Your business plan outlines the fundamentals of what your company does, whom it serves, what it sells, and what its expectations are for the next three to four years.
- Ensure that you can be funded online. Diop says, “You need a website and a domain.” This is because social media is insufficient for convincing lenders that your company can attract customers.
When creating a business plan, Diop concludes, “Your plan needs to be at least ten to seven pages.” Those pages are meant to outline the essential parts of your business, especially when you first start. Furthermore, as a business owner, you can’t expect lenders to understand the purpose of your business if you aren’t completely clear about it.