Home' Trinidad and Tobago Guardian : July 2nd 2015 Contents Q. I'm a 19-year-old student and I'm working
on a business idea with a limited amount of
cash on hand. So the only thing I have to of-
fer people with business expertise is part of
my company (which doesn't exist yet).I don't
like the idea of sharing equity, since I feel like
it won't be my idea, my product or my com-
pany unless I own it in full.
How do you feel when you sell part of a com-
Jake Gerrard, Australia
My friends and I had only a lim-
ited amount of cash when we
started up Virgin Records, but
we were able to attract talented
people - and you can too. The
key: If you look hard enough,
you ll realize that you have far more to offer than
simply an equity stake in your company.
First, ask yourself whether
you have launched a business
that your employees can gen-
uinely be passionate about.
At the core of every Virgin
enterprise is our desire to rad-
ically disrupt or change an
industry in a positive way.
People buy into game-chang-
ing ideas because they get the
heart racing - such ideas can
speak to core values and give you something to believe
in.For instance, back in Virgin Records early days,
people wanted to work with us because we were
focused on promoting diverse artists who were creating
incredible music, yet were being ignored by other
record labels. Our approach attracted bands that rep-
resented overlooked subcultures; bands like the Sex
Pistols, who ended up defining an entire generation.
Fast-forward to today, and we have a similar sit-
uation with Virgin Money. We appeal to people who
have sharp financial instincts, but are looking for a
bank that thinks differently. (What other bank s team
would have launched a "Never Mind the Bollocks,"
Sex Pistols-themed credit card?)
So, Jake, think about what makes your idea different
and how it could make a positive impact, then start
telling talented people in your niche about the reasons
why they should work with you. Chances are they ll
want to help make your idea happen, and their
involvement could take the form of partnerships or
collaborations instead of investments.
Giving away part of your company isn t the only
option if you don t have the luxury of savings or
family to help you finance your idea. A good way to
attract talented people and raise extra funds at the
same time would be to use rewards-based crowd-
funding Web sites such as Kickstarter and Indiegogo.
Capture the passion and ambition behind your idea
in a video, put it online and then offer people a reward
if they support you.
These rewards are usually directly associated with
getting your business up and running, and involve
a batch of your first product or an exclusive version
of the products you want to create. The video will
act as a tool to attract others who might be inspired
by your idea. In the U.K., if you raise money with
rewards-based crowdfunding website Crowdfunder,
you can even become eligible for match loan funding
through Virgin StartUp, which will also provide you
with a mentor.
Later, when your business is ready to expand, you ll
likely have to sell equity in order to grow. While it
can feel safer to maintain full control, selling part of
your company to an organization or individual who
can make it better can be hugely beneficial. For
instance, just last year Delta bought a 49 per cent
stake in Virgin Atlantic from Singapore Airlines. This
was definitely the right step, as it means that Virgin
Atlantic can now offer services at more than 200
North American airports, which will bring our brand
to thousands of new customers. We couldn t have
done it without Delta s support. I was recently in
Detroit to launch our latest route, and it was great
to see the partnership working so well.
Of course, selling part of a company in the pursuit
of growth can feel liberating, but selling an entire
company that you and your team have built from
the ground up is extremely hard. It almost feels like
you re selling your family.
I recall back when we sold Virgin Records in 1992,
we had just signed Janet Jackson and the Rolling
Stones, but we had to sell in order to provide Virgin
Atlantic with the financial clout to compete with
British Airways. I ve
described many times how,
after the deal was done, I ran
down the street with a check
for a billion dollars in my
pocket and tears streaming
down my face. But it had to
be done; that sale guaranteed
Virgin s future, and we
wouldn t be flying today if it
weren t for that decision.
In the end, the difference between making a good
decision and a bad one about selling part of your
company is about patience. Hold out for the right
partner for the right deal at the right time.
(Richard Branson is the founder of the Virgin
Group and companies such as Virgin Atlantic,
Virgin America, Virgin Mobile and Virgin Active.
He maintains a blog at www.virgin.com/richard-
branson/blog. You can follow him on Twitter at
twitter.com/richardbranson. To learn more about
the Virgin Group: www.virgin.com.)
(Questions from readers will be answered in
future columns. Please send them to RichardBran-
firstname.lastname@example.org. Please include your name, coun-
try, e-mail address and the name of the Web site
or publication where you read the column.)
JULY 2 • 2015 www.guardian.co.tt BUSINESS GUARDIAN
COMMENTARY | BG13
further than equity
Raising money online
When you need money to launch your
startup, consider rewards-based crowdfund-
ing. Getting started is relatively easy:
• Study rewards-based crowdfunding web-
sites such as Kickstarter and Indiegogo, and
decide which would work best for you.
• Put a video together to attract investors.
Make sure to capture the passion and ambi-
tion behind your idea in the video. Keep in
mind that it can also act as a tool to attract
others who might be inspired by your idea and
want to join your company.
•m Come up with a reward to offer people
who support you. These rewards usually in-
volve a batch of your first product or an exclu-
sive version of the products you want to
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