Any Ideas how to raise Funds for new Business

Brabazone

Hello all, Since October of 2009 I have being in the process of trying to get a business going. The business is an Airsoft site, for those of you that don't know what Airsoft is, its something similar to Paintball but more realistic, if you want to know more check it out on the sports tab here on boards.ie.

So far I have managed to convince a land owner to let me rent a forest for the site. There were issues with access to the site but I have talked to another land owner that owns adjoining property and he has granted me permission to use his property as the access point. I have had talks with the forest owner and he has also agreed to construct a roadway at no cost to me into the site as there are no means of access by car. The land owner of the adjoining property that is providing access to the site has agreed that this is not an issue for him and has granted permission for the roadway to be built.

I have approached all the local residents in the area and explained the venture and what the sport involves. All the local residents have agreed that they have no abjection to the site being developed and have signed a document to state the same.

I have had meetings with the forest owner where we have discussed rent, insurance, building works, environmental, health and safety and many other issues related to the development of the site. All issues relating to the site are now more or less dealt with only a couple of small stumbling blocks left.

So why am I here, well the truth is I have approached the banks but there not lending to new small business. And there most certainly not lending money for a sport that they have never even heard, so the banks are a no go as far as this project is concerned.

I have also approached the local enterprise board but there issue is that the project could displace jobs in recreational business that they have already invested in. To be specific, Paint Ball. I have explained that the two are not the same and that airsoft attracts a different kind of customer. Usual more mature and with a certain amount of disposable income. The problem I encountered was they could not get what the difference between the two sports was. At this point in time Airsoft is one of the fastest growing sports in the world but some people refuse to listen to what they are being told.

I did present them with detailed figures for what I expected it to earn. The figures were seasonally adjusted and were also based on a low volumes instead of exaggerated figures. I presented it from the point of view of the worst possible return per year. Their response to the figures was that there was a cash flow problem. I explained that these figures were a based on exaggerated low volumes and even at that if they were willing to take a closer look there was still a working cash flow per month.

So, why am I here!, Well it's very simple, I need help. If any of you out there have any ideas or information on how or where I could get funds or help on getting this venture off the ground I would appreciate it.

Cianos

How do you know there are enough airsoft enthusiasts within travelling distance of the proposed site? What is the closest alternative airsoft site and would they be competing for the same participants?

It sounds like you have overcome one of the major barriers for setting up something like this already in that you have the land and permission to get going. So have you looked in to sponsorship? Are there any major airsoft brands that could help in return for endorsement? What about approaching an existing Irish airsoft company and offering yourself as a franchisee?

drunkmonkey

Brabazone wrote: »

So why am I here, well the truth is I have approached the banks but there not lending to new small business.

I have also approached the local enterprise board but there issue is that the project could displace jobs in recreational business that they have already invested in.

I did present them with detailed figures for what I expected it to earn. The figures were seasonally adjusted and were also based on a low volumes instead of exaggerated figures. I presented it from the point of view of the worst possible return per year. Their response to the figures was that there was a cash flow problem

Sounds like you've done a lot of the groundwork, fair play. Usual cop out by the enterprise board not to surprised there.

The banks are lending but they have to see it as an investment where they make money and your account and loans will probably grow over the years with them.

Your right not to exaggerate figures but were maybe wrong to go in too low. Go in with an assumption of the business doing well and base your figures around that.

Failaing the banks you can either turn to venture capitals or friends and family.

You could do what I done but I wouldn't advise it, I started my business on my credit card as I couldn't get money from the banks, they soon changed their minds when I had a maxed out credit card and a good business plan.

Brabazone

Cianos wrote: »

How do you know there are enough airsoft enthusiasts within travelling distance of the proposed site? What is the closest alternative airsoft site and would they be competing for the same participants?

It sounds like you have overcome one of the major barriers for setting up something like this already in that you have the land and permission to get going. So have you looked in to sponsorship? Are there any major airsoft brands that could help in return for endorsement? What about approaching an existing Irish airsoft company and offering yourself as a franchisee?

I am placing the site between Ballinasloe and Athlone, this will make it within commuting distance of all the major towns within about a 30 to 40 mile range. The closest site to me is either one in Galway/Portumna or one in Longford which is members only. Theres no competition in the area within that area.

I will be talking to one of the major airsoft retailers over the comming weeks but that I believe will only cover a relatively small amount if they do decide to sponsor the site.

The amount I need to raise is about 15000 along with my own investment. I know its a relatively small amount in business terms but when you cant get your hand on it, it might aswell be 150000.:(

Brabazone

drunkmonkey wrote: »

Sounds like you've done a lot of the groundwork, fair play. Usual cop out by the enterprise board not to surprised there.

The banks are lending but they have to see it as an investment where they make money and your account and loans will probably grow over the years with them.

Your right not to exaggerate figures but were maybe wrong to go in too low. Go in with an assumption of the business doing well and base your figures around that.

Failaing the banks you can either turn to venture capitals or friends and family.

You could do what I done but I wouldn't advise it, I started my business on my credit card as I couldn't get money from the banks, they soon changed their minds when I had a maxed out credit card and a good business plan.

I think you are right about my figures, probably should have being more optimistic with them.

Thinking of venture capitals but I don't know where to even start looking for them. As for family and friends I just wouldn't feel right asking as times are hard and they all have young family's.

soddy1979

If I was assessing your application I would look for the following things:

1) A base case, best case, and worst case scenario for cash flows.
2) A sound understanding of the independent variables affecting cash flows.
3) Your standing & credit rating.
4) Share of risk. You put in some money, I put in some money.

A couple of specifics regarding your discussion.

a) what is stopping the forest owner deciding on not allowing you to rent anymore.
b) what is stopping the adjoining landowner revoking your allowance to use the entrance road.
c) Is the land zoned correctly, do you have permission to build on it?
d) statistics. Who are your competitors, what population area to they service?, how much do they make? You can go abroad to get these stats if you want and prove the ideas success elsewhere.
e) how are you going to prove there is a correlation between airsoft/paintball and disposable income? This sounds spurious to me.

If you want I can critique your figures for you. PM me if interested.

Cianos

Brabazone wrote: »

I am placing the site between Ballinasloe and Athlone, this will make it within commuting distance of all the major towns within about a 30 to 40 mile range. The closest site to me is either one in Galway/Portumna or one in Longford which is members only. Theres no competition in the area within that area.

I will be talking to one of the major airsoft retailers over the comming weeks but that I believe will only cover a relatively small amount if they do decide to sponsor the site.

The amount I need to raise is about 15000 along with my own investment. I know its a relatively small amount in business terms but when you cant get your hand on it, it might aswell be 150000.:(

How much of your initial set up costs are for equipment? A sponsor/supplier may not be interested in giving cash but could lend out equipment as part of a sponsorship. If you succeeded in obtaining that then it'd reduce your set up costs and would also look a lot more impressive from an investors point of view.

Also regarding equipment, you should be sourcing as many cheap alternatives as possible. Look at buying things second hand instead of new etc etc. Get friends/family to help out with the labour of building the site, call in favours left right and centre etc. Obvious stuff, but just saying anyway.

antoinolachtnai

Do you have a list of people who say they would be interested in using this facility? This would support your case.

For the equipment, it might be worth looking around to see if there is 'spare' equipment elsewhere in the country or in Europe. You might be able to rent it from someone or buy it less expensively.

Do you have planning permission? And the support of local councillors?

Do you really understand the financials of one of the business? You should visit a couple of sites in the UK to understand the whole dynamic.

There follows an answer to your actual question.

You should be sensitive about doing this, but it is worth approaching your landlord to see if they are prepared to invest something. After all, you are adding value to their site.

You should talk to business owners in the locality. If there's a guy with a cafe down the road, he is going to benefit from this. He might be willing to put something in.

I would also talk to other people in the industry, for example, local suppliers. They may see it as worth their while supporting you in some way.

It is worth talking to the tourist boards. They may have some idea of who could come up with the cash. They are in the business of trying to make sure there are things to do in the area. They won't have the money themselves, but they might know someone. That all said, there is not a lot of money swishing around in the tourist industry.

if nothing else comes up, I would consider talking to the Paintball guy. He may be up for diversifying into airsoft.

Axwell

I dont know vast amounts about airsoft but from what I know most of the equipment people use is their own they buy so I assume you wouldnt be looking to rent much equipment or get your hands on it elsewhere and are more providing a venue.

Based on that could you not approach airsoft retailers and try broker a deal where they would be your main supplier and where members would get a discount etc, then ask them as part of the deal to pay you for sponsorship and signage around the site. In the same way approach other businesses who might be in adventure sports or related businesses, also places that provide food and see if they would be interested in sponsorship too. You could say to them that you would include their business on any posters,flyers etc that you use to promote the business and also on signage around the site.

On a smaller scale if you do get to a stage of opening run competitions/prize draws where people can get a full kit off the airsoft retailer or a years memebership or something. I would think outside of the banks and venture capitalists that sponsorship deals is your next best chance of getting some money together. Have you plans of the site or anything done out that you could show businesses so that they could see possibly where they would get to place advertising?

Shayman

[QUOTE=drunkmonkey;64292215

The banks are lending but they have to see it as an investment where they make money and your account and loans will probably grow over the years with them.

[/QUOTE]

Yeah right!! So you've approached one recently then? Share your good news with us. Which bank? Branch? I've been trying to raise 30k for a thriving cash generating FMCG business and tried ALL the main banks. Didn't even get to an interview stage. So will be most interested to hear of your experience.

Bandara

Shayman wrote: »

Yeah right!! So you've approached one recently then? Share your good news with us. Which bank? Branch? I've been trying to raise 30k for a thriving cash generating FMCG business and tried ALL the main banks. Didn't even get to an interview stage. So will be most interested to hear of your experience.

I got 220k funding for a business from BOI Blanchardstown and also 90k funding & 50k overdraft for a seperate venture from Ulster bank Drumcondra. Both in the past month and both without major issue. Yes there was a bit of jumping through hoops but nothing excessive.

Axwell

From your posts in the well though Hammertime I would say you are established and would have collateral and other businesses to back up the loan. The OP wouldnt be likely to be in the same position.

21inchguns

Brabazone wrote: »

I am placing the site between Ballinasloe and Athlone, this will make it within commuting distance of all the major towns within about a 30 to 40 mile range. The closest site to me is either one in Galway/Portumna or one in Longford which is members only. Theres no competition in the area within that area.

I will be talking to one of the major airsoft retailers over the comming weeks but that I believe will only cover a relatively small amount if they do decide to sponsor the site.

The amount I need to raise is about 15000 along with my own investment. I know its a relatively small amount in business terms but when you cant get your hand on it, it might aswell be 150000.:(

How much money are you putting in? I'd say 15k wouldn't touch the sides in getting a business like this off the ground.