The Five Cs Principle Wisdom for Today
Wisdom for Today
An unfair reality of doing business in America is that minority and female entrepreneurs often get only one chance to impress a customer or a group of investors. Some investors are especially unforgiving in their assessment of the value and validity of entrepreneurs and their ideas. To increase your chances of winning a customer or an investor's favor, remember these five Cs:
Character: Moral Excellence and firmness
Capacity: Ability to repay what has been borrowed
Collateral: What the investor can seize if you don’t deliver
Capital: Cash, Stocks, Bonds, or any liquid asset resources (usually money) you are willing to put “at risk”
Credit: Repayment history and level of trustworthiness
When approaching investors about committing capital to your venture, be sure to prepare answers to the following questions prior to meeting:
1. How much capital will you need?
2. How will investors be repaid or “made whole”?
3. How will the capital be used?
4. What collateral can be used to repay the loan if the project fails?
Wallace, R. (2000), Soul Food 52 Principles for Black Entrepreneurial Success, New York: Perseus Publishing
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