Get Happy: Finding the right funding



How do you raise money for a new venture? That’s probably the No. 1 question I get when people find out what I do. 

Is it easy? Absolutely not. But Brainstorm is my fifth company I’ve been involved with from the start, and each one of them has found the necessary funding to launch. There are several ways to raise capital, and the key is finding the strategy that matches your long-term vision. The truth of the matter is that, in the beginning, you are just looking for anyone who has an interest in what you are doing. Even if they aren’t a good candidate as an investor, they may know someone who is.  Plus, you want to practice telling your idea and your story, see how well you tell it, and listen to the feedback to reveal the areas of concern that potential investors will focus on. 

As I was assembling the initial business plan, I tried to be really conservative with our forecasts.  One of the biggest lessons I learned at Never Compromise was not to overpromise. And while it would be great if the Happy Putter became the next Odyssey putter, it doesn’t need to be for us to have a very successful golf company. We projected a “worst case” cash need based on fairly conservative sales figures. Then we decided to raise more than double that amount.Why? Because, no matter how conservative you are, things never go the way you planned.

Blog 3: Raising money

Blog 2: Picking the right team

Blog 1: The reality of a start-up company

Product development always takes longer and is always more expensive than you think. Also, the greatest gift a startup can have is time. The more time you have, the more likely you are to succeed … and sometimes it takes money to have more time. In addition, as you launch a company, there is optimism, and it is easier to raise capital when you don’t need it than when you do. The more desperate you are for funds, the more difficult it is to get, and if you do get it, it comes at a high price. 

It’s not tremendously hard to find people with money to invest. The hard part is looking for investors you really like, who share the vision and are people you really want to be in business with.

The toughest investor to find is the first one. As the stock market proves every day, investors have a “pack mentality,” and very few of them want to go first. The first investor truly becomes family, and they recognize the importance of their role. 

So, even if they’re dangling a bag of money, my advice is: Make sure you really like spending time with this person and are comfortable with them taking a very active role in your company’s creation. 

Enter Jim Crone. As I mentioned in the last blog, Crone is a self-made man.  You’ve heard the expression “salt of the Earth.” Jim is pretty salty, and pretty pepper-y, too.  He’s a Vietnam vet who started his first company in his twenties and worked his way from Pittsburgh to Southern California.  He saved enough money to buy some real estate, and slowly grew his private company into one of the largest commercial real estate companies in San Diego. 

Jim may not know how to make a golf club, but he knows how to make companies that last. Even though Jim had never been involved in golf, his lack of experience worked in our favor. Jim improved the putter by making suggestions based not on “how it’s done in golf,” but on common sense.  We wanted the adjustment features of the Happy Putter to be intuitive and Jim’s inexperience as a golfer helped.

So we found our life-giver, and now we had enough to get started, but we still only had 10 percent of our total capital goal. Most companies fail because they don’t get the proper funding, and with this great idea, we couldn’t let that be our downfall.