Top 10 ways to approach investors to invest in your business
The path of an entrepreneur is fascinating. This rollercoaster ride, full of ups and downs, will take you from nurturing your idea’s seed to watching it develop, bloom, and bear fruit. But this path has its share of bumps in the road. A startup will always seem like a terrific concept from above. You come up with a concept, determine that there is a market for it, scrape together some seed money, and begin working on developing a product. However, every fledgling firm is beset by a dilemma they are powerless to overcome. Funding. A startup may not have the costs of a large corporation, but it still requires financing to lay the necessary foundation.
Everything requires financial support that a startup may not have, from finding the missing skills to purchasing the frameworks needed for your business. Getting people to buy your idea is the simplest way to raise money, but doing the necessary research to find those clients also costs money. Investors step in at this point. Investors are businesses or people who perceive an idea’s tenacity and potential long-term financial benefit. Investors can give you a strong financial foundation so you can concentrate on the product rather than worrying about the details of your finances and being able to employ someone to handle your finances. However, finding these investors might be challenging.
Here is a helpful manual that will aid you on your entrepreneurial path and will give you the courage to contact investors.
- Extend your network.
Many business owners fear making a hard pitch to investors. It makes sense that many find the procedure daunting. Building an investor-rich network is one method to prevent this kind of contact. The dynamics may differ when approaching potential investors if you already have a relationship with them. You might even discover that people show interest in your company’s ideas. Keep in mind that investors aren’t just putting money into your company but also investing in you. Your increased visibility and good standing in industry-related groups benefit you.
- Show some evidence and proofs
Investors typically don’t take a chance when dealing with significant sums of money. They prefer to see concrete evidence that supports the viability of your project. Sadly, getting this at the beginning can be challenging since you haven’t yet obtained funding for the project! It’s not impossible, though. An investor might be persuaded by, for instance, the outcomes of a fruitful small-scale pilot program or some specific research findings indicating high interest.
- Customize your pitch for investors
Before approaching possible investors, if you can, do your homework on them. Concentrating on people most likely to be interested in your investment opportunity will allow you to work efficiently and save time. Maybe they already have a stock portfolio. If so, you should look at the initiatives that have drawn them successfully and seek recurring patterns. To customize your pitch to an investor’s preferences, you must ultimately comprehend their priorities.
Find the best angle to pitch your project to investors to attract them. For instance, a financier who frequently contributes to environmental projects will surely be interested in learning about your company’s sustainability initiatives.
- Choose your co-founders and team members carefully and wisely
Have you ever had a co-founder? If not, you may want to locate one right away. They are an excellent approach to filling in any gaps in your knowledge and experience. For instance, you might be the mind behind a fantastic new invention but lack business sense. Investors will be more interested in your project if it has a co-founder with a business background. If the idea of pitching makes you incredibly uncomfortable, you can choose a co-founder who can speak with assurance.
- Work on refining your business
Make sure your business is in the finest condition before you sell it to others. Participating in a startup accelerator is one approach to do this. A renowned accelerator has several advantages, including the chance to network, meet mentors, and solve any problems you may have had while developing your idea. Graduating through some accelerators could impress and draw in potential investors because of their stellar reputations.
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- Have a strong online presence
Before deciding to invest in your company, investors will undoubtedly study it online, so make sure what they discover is favourable. It shows interest in your project if you can amass a group of backers before you begin pitching.
A shoddy online presence won’t give people confidence in your skills. Your website and social media profiles should be current and polished for good first impressions.
- Be open-minded as you think about investors.
It’s important to remember that company investors aren’t always seen as wealthy individuals wearing pricey suits. Alternative sources of funding are now available. Perhaps collective funding is a good fit for your project. This can be facilitated through internet platforms that connect interested parties with investment possibilities.
The experience of pitching on these platforms differs from the conventional investor pitch. Examine other projects on your preferred platform that gathered money effectively to get ideas for your strategy and to discover how they met their objectives.
- Place emphasis on your uniqueness
Investors have presumably seen a lot of pitches; therefore, they are probably getting tired of the same old. Of course, you shouldn’t base your pitch on cheap tricks, but you should focus on and emphasize the distinctive qualities of your project.
Clearly state what makes your proposal unique and how it will help your company beat its rivals. What does it offer that no other company in your industry does not? The main objective is to create excitement. Investors in your company should be motivated to support your endeavour.
- Ensure you refine your presentation
It’s never a good idea to wing it during a pitch to a potential investor. You run the danger of not only losing your investment but also hurting your reputation, which might have long-term effects on your company. Prepare for your pitch and properly practice your presentation to avoid this. Ideally, you should practice it in front of an informed audience that may offer helpful criticism. Show that you are a professional and respect the investor’s time by demonstrating your professionalism. They will feel much more confident doing business with you as a result.
- How are you managing your finances?
Where an investor’s money goes piques their interest. For them to comprehend that their money won’t be wasted on a golfing set, they need to know that you manage your money wisely and in a regulated manner. The funds won’t be used for private objectives but rather for the company’s growth. Additionally, make an effort to have current written proof of your past financial transactions and contacts with money. The profit/loss statement allows you to assess the status of your current business venture, its stability, and the company’s capacity for self-control. These reports will help investors assess the strength of your business idea.
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