Getting Ready Emotionally

Financial nuts and bolts, like learning how to do a profit-and-loss statement or devising a marketing strategy, are challenging. But the really hard stuff is inside. Like fears of failing. Or feeling you are totally alone and nobody can understand the pressure you're under. Or a perfectionistic streak that tells you if you can't get the perfect money deal, you won't take anything.

One of the most imporant things to understand is your relationship to money. Intensely symbolic, money can represent four basic human needs: love, security, power and freedom, says Linda Barbanel, a New York psychotherapist who's often called the "Dr. Ruth" of money. In her book, Sex, Money and Power: Smart Ways to Resolve Money Conflicts and Keep Them From Sabotaging Your Close Relationships (Macmillan Spectrum, $14.95), Barbanel has defined four major money personality types: "love buyers," "keepers," "power seekers" and "freedom searchers." Most people are a blend of several types. Applying Barbanel's principles to financing a business can help you figure out which "you'' is really conducting your money negotiations.

Table of Contents

1. Self-Exam: Your Relationship to Money

2. Rhonda's Tips

3. Resources

1. Self Exam: When money talks, what does it say about you?

1. Do your fancy offices, $1,000 suits and expensive stationery fairly shout your status?
2. Do you almost always pay full price?
3. Have you invested in risky deals, losing more than 15% of your investment?
4. Do you rarely listen to financial experts?

If the answer is yes to most questions, you're a "power seeker." Power and status compensate for feelings of powerlessness and humiliation in childhood. You may use money to control other people.

5. Do you find it hard to spend money on your business?
6. Do you pay your bills on time, or early, by check or cash?
7. Does the thought of paying interest to borrow money make you nervous?
8. Do you feel unduly alarmed at the thought of investing for 5 years or more?

If the answer is "yes" to most questions, you're a "keeper." Money is security, and you hate to part with it. It's your hedge against a tough world, and you're driven to compensate for a childhood marked by financial and/or emotional insecurity.

9. Do you tend to overspend on credit cards?
10. Do you cheer yourself up when you feel depressed by making a big purchase?
11. Do you over-tip?
12. Do you think you can "buy" people by doing favors for them?

If the answer is "yes" to most questions, you're a "love buyer." Money is love, and you probably had a lot more of the former than the latter growing up. You've confused the two ever since.

13. Do you have trouble committing to leases, furnishings, long-term relationships?
14. Do you make your investments without a broker?
15. Do you work hard for a long time, then take off and loaf for a few months?
16. Do you want no partners?

If the answer is "yes" to most questions, you're a "freedom searcher." Money equals independence. You refuse to be tied down by anything or anybody, and hate to feel you owe anybody--emotionally or financially.

2. Rhonda's Tips

Business planning expert Rhonda Abrams offers tips and insights on getting emotionally ready.

The hunt for money can be an emotionally harrowing one. For entrepreneurs, who are used to taking control of their own destiny, they may find the process is mostly dependent on the actions of others, some who act irrationally or incomprehensibly.

Also, the financing process, especially if you're looking for investors, can take a long time. This means long delays in doing the things you know to be necessary to build your business. It's pretty darn tough to be seeing your competitors moving forward while you're still waiting for a return call from a venture capitalist.

And the financing process is likely to be an emotional roller-coaster. One day you'll have a great meeting with a potential funder and be thrilled -- ready to pop the champagne because you're sure the money is just around the corner and your dreams will come to fruition. Then the funder takes weeks, not saying yes and not saying no. Your emotional high goes to an emotional low.

Don't expect your family and friends to understand. They want you to succeed and they'll try to cheer you up, but if they've never tried to raise money, they just won't get it. And spouses may get particularly nervous, fearful of every downturn and increasingly suspicious of every piece of good news.

Make sure you stay on top of things you can control while looking for money, since the financing process takes decision making out of your hands. It will help you stay sane.

3. Resources

Barbanel, Linda. Sex, Money and Power: Smart Ways to Resolve Money Conflicts and Keep Them From Sabotaging Your Close Relationships. (Macmillan Spectrum, $14.95)

Maddox, Rebecca. Inc. Your Dreams: For Any Woman Who Is Thinking About Her Own Business. (Penguin: $11.95)

Mellan, Olivia. Overcoming Overspending. (Walker, $18.95)

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