In order to get a project funded, you need revenue projections, but how do you do revenue projections when you are working on a completely new idea?  How many times have you been in this conundrum?

Sometimes you are in a catch 22 – you need resources to do revenue projections, but you need money for those resources.

Here are five tips to get yourself out of this pickle

1. Start small: Do not ask for the entire money upfront. Ask for enough money to do a prototype. Do some market research using the prototype. Usertesting.com is a great way to do research in a relatively inexpensive way. Once you have some results from your research, use those to build your business case.
2. Sell the big picture : If your project costs $2 million, but your NPV numbers need work, don’t talk numbers just yet. Talk about the vision of how the big project would change the way your company interacts with its customers. However, mention that you are only asking for a small fraction of the cost to do prototyping (say $50K). This is a much more palatable number that most funding committees are likely to approve provided the big picture is worth it.
3. Tap into innovation groups:  Does your company have an innovation division? It may be worth speaking with them if they would be willing to fund your prototype research. Doing research on new and risky ideas is what most innovation groups do and their revenue projection requirements are often not as stringent. You can even promise to return the money once you get the full project funded in the traditional way. 🙂
4. Communicate, Communicate, Communicate: Communicate every step of the way. Socializing and getting some of the funding committee members excited about the vision before you even ask for money will go a long way in getting you the approvals you need. Also, make sure that you return to the same group frequently to provide updates.
5. Prepare to fail fast: Make sure you have an exit strategy and communicate it clearly to your leadership and the funding committee. If you feel that this is not going the way you thought it would, be bold and pull the plug. If you communicate up front and obtain the buy-in, people would see that you saved the company $1.95 million and not that you lost $50K

Good luck with your business cases! Let me know if you have other tips on building the business case for your projects.