Over the years, I have been involved in raising capital for ventures ranging from restaurants, bars, jewelry, real estate, mobile applications and nutritional products. As a lawyer and entrepreneur, one of the most common questions I’m asked is how one should go about raising money for their start-up business. Many have anticipated my answer to reveal some sort of secret special place, or hidden money tree that is known only to a select few. However, you can probably guess there is no such place.

Much like the business you are seeking to fund, the better prepared you are to raise the money, the more successful you will be. It may be a seemingly insurmountable task, and at times throughout the process it can be very daunting, but following a few simple steps will help make the difference between Feast or Famine. While the businesses may vary greatly, there are some principles and guidelines that will remain consistent throughout the capital raising process. There are also multiple sources of financing but for purposes of this article we are just going to discuss private investors.

1. Start with Family and Friends

The most important step to raising money for your product is simple, you must get started!  Talk to your family and close friends. Tell them your idea and see what they think. I always think of family and friends as the low-hanging fruit from an investment perspective. Every single one of us knows someone that will back their idea no matter how hair-brained or speculative it may initially appear. As you receive feedback about your idea from family and friends, fine-tune and structure your business plan in order to strengthen your presentation to potential investors. They may also talk you out of your venture if its particularly nonsensical and thus save you a great deal of time and money. For those of you out there thinking “I have literally no family or friends”, first know that I’ll be your friend! However, you’re likely going to need more than one friend so start thinking about the billion people you have access to in the world of social media. Facebook, LinkedIn, Instagram, and any of the other popular sites are an abundant resource for networking so make a profile, present yourself well through interesting posts relevant to your goals, and get to work!

2) Polish Your Plan

Let’s assume that your family and friends not only think there is some merit to your idea but actually agree to invest.  At this point you are in the game and it’s time to step it up! Take a better look at your business plan and spend some money making it look clean, enticing, and exciting. No one is interested in ‘boring’, if they wanted ‘boring’ they would invest their money into a savings account or a money market fund.  Add pictures to your business plan. If it’s a restaurant or hospitality project show the investors the elegant seating, illuminated bar, and colorful cuisine. Let them imagine walking into “their” restaurant and being greeted by the smiling host or hostess. If it’s a cutting-edge new application, show them the outrageous growth in this sector. Compare the product to other successful applications and include some press on other similarly related technology.

Your business plan is also going to require a description of the entity (i.e. an LLC or Corporation). Contained either within the business plan or an accompanying document, a vehicle for the potential investor to invest in such as an offering memorandum or a placement memorandum. You will have to consult a lawyer for these items and I would advise it to be a specialized attorney that can show you other investment projects that they have served as counsel to.

3. Network, Network, Network!

Now that your business plan is clean, concise and ready, you hit the pavement trying to strum up some dollars.  Hopefully some of your family and friends who have expressed interest pony up. If not then you hit your rolodex, social media and everyone you know that may have a few dollars burning a hole in their pocket. In Real Estate, the name of the game is ‘location, location, location’. In raising capital for your business venture, the key is ‘network, network, network’! There are individuals out there whose track record is such that all they have to do is pick up the phone and the checks roll in. Since most of us don’t have this luxury, raising capital turns into a numbers game so the larger your network, the more potential investors that you may have and subsequently the more money you can possibly raise.

4. Dress for Success

While you’re out there pounding the pavement make sure to bring your “A” game. If someone is going to trust you with their money you have to look the part. Wear a suit, blazer or sport coat. Clean your car to ensure that you look presentable and organized on all fronts. I want to warn you though that there is such a thing as ‘too nice’. I once went to a capital-raising meeting and took my friend’s car which was very high-end. The investor chose not to park any money with me and I later learned that the guy was turned off by the flashy car I was driving. The key is to put your best foot forward. Only you know what the best most presentable version of yourself is.

5. Expenses

There is going to be an expense associated with raising money. Dinners aren’t free and neither is travel. How much should you invest in an investor? How many dinners, cocktails, and miles traveled? My general rule with private investors is that if it costs me 3%-5% to raise money then it was well spent. For example, I don’t mind spending $3,000-$5,000 to raise $100,000.

6. Ownership and Accountability

Lastly, and perhaps most importantly, treat their money like it is your own. Avoid being wasteful through overspending, always bearing in mind that everything is negotiable, from social media support to web site designs. Make use of websites that offer affordable marketing materials such as Fiverr.com and 99Designs. Think the barter system is dated? You would be surprised how many times I have successfully traded services and how fruitful that has been while entering into another startup venture.

In closing, raising capital will demand your full commitment, tenacity, and persistence. With these simple guidelines, you will be well on your way to building your great new business idea.