I’ve heard this saying a thousand times but never has it had so much meaning as it has over the last several months. No matter how long I think a certain task is going to take, it always seems to take at least twice as long. This is most applicable to the daunting task of raising capital. We have been working to raise investor money for over 9 months and we have received only a fraction of what we need.
Part of the reason that this has been taking so long is due to incomplete advice along the way. When we started to plan how to raise the money, we were told that we could easily raise half a million dollars with promissory notes or equity. We wanted to use promissory notes instead of equity because we wanted to keep control of 100% of the company. However, this advice missed a few important details. Not only did we not raise half a million dollars, but we raised NOTHING! No one was interested in a promissory note with a start-up company that did not have any tangible assets. Also, we later found out from our lawyer that the owner of the business would be personally liable to pay back any money given to us based on a promissory note. So there went 3 months of wasted time basing everything on a promissory note. We expected to have received all of the money by this time, but instead we were back to square one.
Once we realized that we had no choice but to offer an equity-based investment, we spent several weeks redoing our investment offer and spreadsheets to reflect the new opportunity. Now, several months later, we are still working to raise the rest of the money we need in order to move into production. We have raised a portion of the money and we have several potential investors who want to see a prototype before they will invest. So now we are in a chicken and egg situation, where we need money to build the prototype but we need the prototype to get the money.
In addition to the long process of raising money, it seems that everything else moves at a snails pace. Recently, we have been working with outside engineering consultants to finalize the design of the fiberglass body. We estimated that this would take approximately 1-2 days of engineering time to complete. However, it is now 3 designers and 7 weeks later and we are ALMOST finished and ready to order the prototype. None of the outside people that we work with seem to understand our urgency to get a task done. Lack of funds being a constant constraint does not help the situation either.
Moral of the story, when it comes to starting a business no matter how long you think a task will take it will always take longer. So if you think it will take 1 week, you should prepare for it take 2 weeks and be pleasantly surprise if it gets done in 3 weeks. There is a silver lining though. We have met a number of new acquaintances who have been very supportive and have provided an expanded network that makes us confident we will be successful.