Getting money for your small business or startup has become so challenging in recent years that they’ve turned the process into a TV show. Shark Tank is a show all about small business financing. The premise of the show is this: you, the small business owner or representative, pitch your business to the millionaire and billionaire entrepreneurs on the panel.

You tell them what your business is, how much money you are seeking, and what you are willing to give them in exchange for the money, such as a percentage of your company. If they find your offering appealing they may negotiate over the details of the deal. Or, if they don’t like what you present, then, as they say, “you are out.”

Small Business Finance Is All About Knowing Your Numbers

The show, which airs on ABC, has about 7 million viewers tuning in every week. It has provided much fodder to the larger small business community and given entrepreneurs great visibility. Thanks to the show, everyone is now talking about New Business Funding, Small Business Financing for the long haul as well as small business ownership in general. Fast Company, a publication for entrepreneurs, has written about the show’s value especially when it comes to how owners should prepare themselves when seeking Small Business Funding from venture capitalists and others. A takeaway from the show is knowing your numbers — your expenses, revenue, and profits, down to the nitty-gritty. It often plays a huge role in whether funding for that small business occurs or not. This wisdom equally applies when seeking small business loans or even small business invoice factoring.

Answering “How Will You Use the Money?” Is Key to Start Up Financing

If the “Sharks” are interested in your business, they will often ask what you will use the money for. Having a solid, verifiable, and vetted answer can often be the difference between getting the start up funding and not. Saying with confidence, “I need the $100,000 to fulfill a large purchase order,” is much better than saying “I need the money to grow my business.” Similarly, this rule of thumb applies when applying for a loan or even when factoring receivables. Knowing how much money you need, why you need the money, and specifically how you will use it if you get it is of huge importance to the lending institution or invoice factoring company.