Global Star Capital Blog posted by Rich Cocovich, Founder Global Star Capital
"The Top 10 Reasons Funding is NOT Obtained for Projects and Principals"
As the credit and banking crisis in the United States has now touched every corner of the world, private funding is back to being "King". Therefore, Global Star Capital has seen it's highest demand for services in 10 years. As you can gather from our website (http://www.globalstarcapital.com/), we are world's top intermediary/consulting firm in private funding with clients in 119 countries since 1991.
I am personally passionate in helping my clients achieve the success level of actually receiving funding. In order to help the entire cause within this industry, I have made the "The Top 10 Reasons Funding is NOT Obtained for Projects and Principals" list.
Rest assured, that if you do not have a high end professional intermediary/consultant such as myself working many hard hours for you, your project will not be funded. That is 20+ years of experience speaking to you.
Below is the list:
"The Top 10 Reasons Funding is NOT Obtained for Projects and Principals"
10. Your Project is not solvent or capable of making money. If I would tell you how many projects we see where the principal or team in adamant that their concept is the best idea since sliced bread, yet have no idea how they would make an investor money or be able to pay back a lender, shock waves would hit you. Literally hundreds a year.
Rule #1: Make sure your idea or project can actually work and make everyone money. This starts with proper planning, market research etc.
9. Your documentation is not well prepared. Assuming you have a great idea that can actually make money for all parties involved, your formal documentation (business plan, pro-forma etc.) needs to be perfect. Global Star Capital is in such high demand for our services because we present perfect, solvent projects to the decision making facilitating sources and back them up with our reputation and dedication.
Rule #2: Have great looking and highly informative documentation. Please remove the idea form your head that an executive summary is all that you will need. Part of our engagement process of Global Star Capital is arranging your documentation properly.
8. You have broad casted your Project around the internet too much. The worst thing you can do is broadcast your project around the internet to whoever will see it. Hear me loud and clear---there are only a handful of true lending sources outside of traditional banks (which have dried up) that will entertain your project. The underwriters at these sources do not want to see the same project brought to them by multiple people---that is a big red flag in their minds. These underwriters rely on a high end professional to entertain them with the project.
Rule #3: Do not broadcast or "shotgun" your project around the internet. A high end professional with services like Global Star Capital's is your only real chance. I am not speaking about any broker you will sign a non-exclusive agreement with either.
7. You have signed non-exclusive agreements with many "brokers". There are only a small percentage of "brokers" or intermediaries that can get a project closed. Never forget that. In fact, we formed a training program at Global Star Capital for serious and ethical "brokers" to properly vett a project and submit to our avenues through our full blown services. I am speaking to you point blank---the funding sources in the private funding world rely on underwriters from either internally or professional firms vett projects. Unless you have a professional intermediary/consultant such as myself, you will never be able to have your project's "story" be told right to those underwriters. Again that is 20+ years of professional services and clients in 1991 countries speaking to you.
Rule #4: Do not sign multiple non-exclusive "broker agreements", it will hurt your chances of success.
6. You are paying an attorney for advice on who to hire for professional intermediary services. "My attorney tells me never to pay fees". I hear that every day. My questions are simple in return: "How much money are you paying your attorney to give that advice?" "How many projects has your attorney funded on their own?" and, "Why is your attorney not the instrumental source in finding your funding?" My clients understand that I am a paid professional on the equivalent scale of a high end corporate attorney or CPA. I get results, therefore I am paid accordingly. I do not spend my own money to be reimbursed.
Rule #5: Never let an attorney stand in your way of working with other warranted professionals.
5. You are cheap and have your hand out for everything that is "free". I literally have had potential clients scan a handwritten concept and not arrange it via a word processor just "save money". I have also had many potential clients use the term "Angel investor" as they believe "Angels" exist and have no closing costs. In addition, I have had many potential clients say that they will only pay fees after the loan has closed and they want the fees embedded in their loan.
Rule #6: If you are cheap, have no collateral or money and believe that everything should be handed to you for free, quit now. You will never be funded if you are cheap and have those philosophies. "Angels" do not exist in the funding world. There are literally fees for every step with a lender etc. I make it clear to my clients that once we are engaged, we fight for you and represent you like the professional you need to lessen fees dramatically.
4. You refuse to provide the lender with additional documentation when requested. I have had clients who have been 10 days away from a closing who refuse to release requested documentation to the lender such as tax information (as an example) despite being coached properly and perfectly by me personally. Hear me loud and clear. If a lender wants to know the color of your underwear and they are willing to invest in you millions of dollars---plus close the deal---you need to follow through. In today's market, there are hundreds of projects that can be entertained by the lenders. One big red flag is not supplying requested documentation.
Rule #7: In order to close and receive funding, please know that the professionals working for you such as the underwriters and myself personally must provide the investor (he or she who has the money) with all of the requested documentation. All requests are 100% legitimate and realistic---just do it.
3. You have too many partners or principals on your team. A majority of rejections to projects I give result from too many people on the team looking for funding. On one call recently for a project in Charleston, SC there were 9 partners on the phone with me. Within 5 minutes I had them disagreeing and fighting over their own idea. In addition, I have had potential clients with a team of "advisers" on calls. These are usually attorneys or "brokers" or people who leech onto projects claiming to be the most intelligent human in the field--yet have zero money. I can assure you that the only people who should make decisions and speak to the professionals in the investing avenues are the head principals. Everyone else will screw up the process royally and paste a black eye on your project.
Rule #8: Make sure there is one deciding contact person on your project. Make sure that this one person has the ability to answer the major questions that will be asked on the project. Basically, your front man or woman should do most of the talking and dealing.
2. You cannot communicate in a timely fashion. I have had clients in the past who literally took two days to return my call or write back to me. They also took several days to gather information for the underwriters. They put themselves in a situation whereas we do not know if they seriously believe in their own project. I cannot stress the importance of communication. When investing avenues call or write, take the time to respond. After all, your project is what needs funded for your dream to become a reality.
Rule #9: Communication is the key to success.
1. You are a "know it all" who's disposition irritates even the mildest mannered people. What irks me and all of the professionals in this industry the most are people who try and tell us how to run our companies or business because they "know it all". Basically, "know it all" types really do not know anything when it gets right down to my profession. Whether they try and express how successful they have been or how I am to be compensated to where I should "shop" their project etc., nothing kills a project more than a "know it all". A "know it all" could also be in the form of an attorney giving you that overpriced paid worthless advice. You must comprehend that if you actually knew how to acquire proper funding for your project, my professional services would not be needed. It is very comical to see projects come back around to my desk 6 months or more after I declined them because somebody was a "know it all". There is a project in Wyoming dealing with Oil Shale that has been floating around for 50+ months. The principal is a "know it all". I achieve much enjoyment for myself by sending him e-mails alerting that a "broker" has tried to rekindle his project and has tried dump it on my desk again. This man tried to tell me how to run my corporation on several occasions---he deserves it.
Rule #10: You do not "know it all", so be prepared to follow the proven steps of the protocol.
You can read more about Rich Cocovich in the EXECUTIVE section of the Global Star Capital website (http://www.globalstarcapital.com/). Global Star Capital is your key to project funding and is top rated by DUN and BRADSTREET DUNS 147151315 from the parent Global Star company down through it's subsidiaries.