We sat down with New Orleans entrepreneur and investor Charlie Rareshide of Lagniappe Capital for a Q&A on what he looks for in a new business investment. Lagniappe Capital is one of the main forces behind bringing Jamba Juice (yum) to NOLA and he is also a partner in the local clothing line Pret-a-Porter.
Lagniappe Capital was born when Charlie returned to New Orleans, after living in New York City for 8 years. When Hurricane Katrina hit, he decided to come back home to a city that seemed to have a clean slate. The rebuilding of New Orleans was the perfect opportunity to invest and get involved in the reconstruction of what he felt like was a new city with lots to offer.
What do you look for in a business investment?
Passion and People. Good investments are built with investing personal time and enthusiasm. You need to be ready to dedicate yourself completely and feel good about it. Being with the right people helps to ease the stress that comes with a new business venture.
How can small business owners capture the attention of venture capitalists?
Creating a business plan is first and foremost. Also, remember that your investment needs to be in a certain scope of business and that your business model needs to fall within that certain range.
What catches your attention in a business plan?
The key individual’s backgrounds are always the most important things to me. Seeing that everyone involved has good dynamics with one another and expertise in different areas brings so much more to the table.
When it comes to putting something of your own into an investment, is one quality more important than the other? For example, is money more important than passion? What about work ethic?
In order to have a business that is successful you need to have everything. If you are not passionate about it, there is no need to invest. There needs to be some level of passion to be successful. Some people invest only for opportunity, but you need to understand what you are investing in at all times.
You stressed that people are such an important part of your investments. Do you have any advice for investing in people?
Look for people who are trustworthy and reliable. Creating a good team is imperative to having a successful business. Creating trust is the foundation of good teamwork.
When it comes to planning…
Have a solid plan and stick to it, regardless of what happens. Nothing goes as planned, but if you have something on paper, it creates a vision of where you need to be. Having something to reference helps to keep your ideas focused.
Why is having a financial capability so imperative?
Funding is important because there will be times when unexpected things will come along. Financial resources will be the answer. Inevitably, any business will go through this regardless of how mature or immature it may be. I assure you that at some point and time finances will become an issue. It may be for growth or stability, but having those financial resources possess a great deal of importance.
Do you have any tips for a small business looking for an investor?
A generous amount of Upside and Opportunity is important. You want lots of opportunity for future growth. You also want to have some sort of protection, whether its patents or trademarks, anything like that would be a good support when you want to approach an investor. Territorial rights in a marketplace are also important. Being an investor and an operator for Jamba Juice, one of the key factors was being protected that no one else could come into New Orleans and do exactly what we wanted to do.