In my last post, Proving You Can Execute, I talked about the importance of answering questions about 'how' you are going to execute. Finding the right answers to these questions is often difficult.

Part of the answers show that you are already building the business, which is what you should be doing anyway. What you are currently doing should provide a VC with guidance about the method for achieving your objectives and demonstrate your ability to figure out what needs to be done. For example, if asked “How will you acquire customers,” the best answer is a description of how you have acquired your first customers. If a lack of funding or product or talent keeps you from signing your first customers, get as close as you can to doing so: talk to potential customers, draft contracts to be signed once you meet some hurdle the customer has laid out for you, and so on. If you are doing all you can to develop the business without VC funding, answering part of the ‘how’ questions should be easy.

The other part of the answer will come from your plan for the business after you have been funded.

The best answer to a how question about your use of resources after funding is rarely 'as many as possible'. As an entrepreneur you will always have limited resources. As a result, the answers to the ‘how’ are the product of a resource balancing act. For example, you might need sales reps, a marketing budget and a development team. Figuring out how much capital and time to invest in each may not be easy, since they all could be mission critical.

The best way to formulate a sophisticated resource allocation plan is through operational and financial modeling. If someone on your team knows how to do this you should be in good shape. If not, you should recruit someone who does. You need to find your team’s complement.

People who have worked in strategy consulting or in business development are usually well suited for this role. If you are having trouble finding someone, make sure to look at local business schools. For New Yorkers I would suggest reaching out to Columbia Business School’s Entrepreneurship Club.

Figuring out the ‘how’ can be very difficult. However, getting it right can prepare you to succeed.