Page 81 - The UnCaptive Agent

54 THE UNCAPTIVE AGENT

a scramble for cash in the beginning. I recently heard
the cofounder of YouTube, Chad Hurley (who sold his
business eighteen months after founding to Google for
$1.5 billion), refers to his initial business plan as the
“Ramen Noodle Plan.” It is very common for founders
to invest every dollar they have (and many they don’t)
in their business before it begins to print money.
The very best place for startup capital is from the
founder’s personal savings. Hopefully, your dream of
starting your own agency is one you have nurtured
for some time and one that you have been saving for.
One of the things I always look for before committing
my company’s capital and resources to assisting a new
agency venture is whether the founders have any savings.
And I see all different levels of savings. But when I see
no savings at all, I know I am looking at someone who
will have a tough time making it.
If, after reviewing your capital needs, your bank
account is short, my question would be whether you
have assets—including retirement accounts—you can
sell or liquidate. Some may think cashing in an IRA is
foolish because of the tax penalty involved. My reply
to that is, “How badly do you want to own your own
business?” And it is a fairly simple math problem to
demonstrate an excellent return on investment created
by a successful agent that can render that tax penalty
chump change.
So, you’ve liquidated your retirement and sold your
baseball card collection and you’re still short. Now what?
Have you sold your house? Downsized your car? Had
a garage sale?
After you have thoroughly searched for every nickel
you can find, the next place to look for startup capital is
borrowed money. Can you borrow the money from your
family or friends? If you do, you should be businesslike