Your parents might be your biggest supporters. They could be the people who stand by you when you make a mistake and help you get back on your feet; they could be the people who encourage you to try new things.
It might make sense, then, to ask your parents for an investment if you want to start a business. However, before you do this, it can be wise to consider a few important tips.
- Be professional. Approach talking to your parents about investing as if you were talking to a stranger. Have a business plan in place; know your financial needs and goals; be prepared to discuss when they can expect to get their money back. Formalizing the process and the transaction can make it easier for parents to make informed decisions. It also shows that you are serious about the endeavor.
- Understand that “no” is an acceptable answer. As this Associated Press article notes, starting a business is a risk, and not all parents are willing or able to take on that risk. Keep in mind the fact that they have financial goals and priorities, as well. Remembering this can protect your relationship with your parents, even if they say no.
- Don’t assume that financial support is the only meaningful type of support. If your parents decline the opportunity to invest, don’t assume that they don’t support you or your business goals. They may be willing to help in other, non-financial ways, and these can be extremely important as well. For instance, they might take care of your kids when you are working on the business; they might be willing to connect you with legal, financial or other professional resources; they could help you with various business-related tasks.
Taking the time to think about these details can help you manage your expectations and set yourself up for a positive experience.
It is not always easy for children to ask parents for help, nor is it easy for parents to make sacrifices for a child’s business venture. Taking the situation seriously, being prepared for a “no” and accepting non-financial forms of support can make it easier to protect your new business and your relationship with your parents.