During our zeal to launch a venture we are tempted to throw caution to the wind. When we do that, our dreams are apt to evaporate into the wind as well. Business plans constructed upon verbal promises are as stable as sand castles built at low tide.
We place our complete trust in friends, long-standing acquaintances and government agencies. Now, this trusting has been the essence of some great collaborations and accomplishments. The problem seems to lie in the concept of, "complete."
Most promises are made by well-meaning people with integrity. Funds available today are not necessarily there tomorrow. Promises of available funds become subject to various forces that stewards of funds are often obliged to obey.
There is a competition for available funds. Competing forces can, later, supersede the verbal promise made to you.
Promises can be made under a certain set of economic conditions that have changed at delivery time.
Third parties, unrevealed to you, may have been the real owners of the funds.
Implied or fictional sources may have caused you to jump to faulty assumptions.
Real ownership may have been misrepresented to you.
Grants from one government agent can be countermanded by another agent.
The risks from verbal promises can be reduced or mitigated by the use of some devices such as written understandings, legal agreements, deposits, payments to an escrow or a collateral pledge. While not guarantees, they can prevent you from acting under false assumptions. Knowing the probability of funds being available when needed will alter your plans. Timing is of the essence.
Critical negotiations in your business plans should be secured by some evidence or by a truth revealing device.
The cautions listed here have come from personal experience. I'm tempted to call it, "bitter" experience because of the memories of some misfortunes. I am given pause because I have heard of so many others who became victims of the same circumstances. The person is rare who can vigorously pursue a dream and be extremely cautious at the same time. The current dream is that some of you readers may benefit from the thoughts expressed here.
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