When asking for money, follow these simple guidelines
At some point in your professional or personal life, you will need money to achieve your goals. Whether you are raising capital to launch a new start-up, or you are inviting a donor to contribute to your non-profit campaign, or you are proposing to a friend they loan you cash so you can purchase a new TV, you need to have a plan to get the results you want.
Although there are many different scenarios in which you may find yourself in need of money, there are five simple steps to follow to get the funds in your hands as quickly as possible.
Say that you have an idea for a business, but you need money from lenders or investors to get your idea up and running. An investor isn’t going to give you money with no questions asked about how you are going to use their money. They want to make sure that their money is going to be used properly.
Before you even think about asking for money from someone, you need to ask yourself a few questions:
- What am I going to do with this money?
- How quickly do I expect to produce a return on this investment?
- Will I need more money in the future after this initial investment?
If you expect someone to give you money, be prepared to answer any questions about yourself and your project first.
Now that you know exactly how you are going to use the money, you need to figure out who you are going to ask for that money.
Let’s assume you work for a non-profit organization that supports cancer research for children. The most likely people you are going to attract donations from are people who also think supporting cancer research for children is a worthwhile cause. At the same time you want to make sure that even though most people would like to support your cause not everyone can support your cause. Finding the right mix of people that want to and can support your cause will give you the right group of people most likely to support you.
So we know how we are going to use this money, and we know who we are getting this money from, but how do we actually get the money? We need to make a connection.
How many people actually give money to the homeless people on the street? Is it because we aren’t generous? Most likely, no. We do not give to these people because we don’t have a connection with them. People are much more likely to give money to a person or cause in which they feel they have some sort of connection.
To establish this connection, introduce yourself to the people you are going to ask for money. Take them out to eat for lunch, go grab a cup of coffee at a local coffee shop, or give them tickets to a game or a show. It is important to make a personal connection with these people before you ask for their money. It is easier to say no to a stranger than it is to say no to a friend.
For some, this can be the most challenging step in the whole asking process. However, it can also be the easiest step in the process. If you have done your homework into you and your project and you are ready to answer any question that comes your way; if you have successfully identified the person or group of people you want to ask for money; and if you have successfully made a true connection with these people, the ask should be a piece of cake.
When you get to the moment of The Ask, be honest and straightforward. By the time you arrive at this conversation, usually the person you are asking already knows you are going to ask for money. You need to be confident and sure of yourself when making your pitch. State your case precisely how you wish, and spell it out for your donor in black in white. If you want $2,500 from your friend to buy the latest plasma 3-D flat-screen television, you need to ask your friend for exactly that.
At this point, you have done all of your homework and now the ball is in the court of your investor. Do not assume that the asking process is over for you. Most likely, your lender will not immediately say “yes” but they will not immediately say “no” either.
It is your responsibility to follow up with your investor in a timely and polite manner. Nobody wants to get three phone calls and five emails a day from anyone about the same issue. But, you also don’t want your donors to forget about you after a few days. The majority of donors receive their funds through valuable and insightful conversations with their investors after The Ask.
Although ever financial situation is unique, simply follow these five easy steps and you will be prepared to ask the right person for the right amount of money at just the right time.