If you want to launch a business that will require significant funds to get off the ground, or if you want to grow an already-running organization, it’s likely you will consider trying to get investors to back you. While this can make the world of difference to how things pan out, you will have lots of competition in getting those funds, and have to find ways to stand out from the crowd. Read on for some tips you can follow to help make yourself and your business more attractive to investors.
Be a Business Leader They Respect and Want to Work With
For starters, because investors aren’t just looking at a business when they consider investing, but the people running it as well, it’s necessary to show how you will be someone they want to work with. You need to show, for instance, that you have an understanding of how to run a venture, and have had some relevant training. It pays to have completed a business degree online or elsewhere, where you learned about topics such as finance, accounting, marketing, sales, human resources, leadership and more.
If you don’t have an education in business, it helps to at least have had experience running one before, even if it was a small organization. The more you can show that you understand how to lead and to think about profits and growth, not just the glamor of being an entrepreneur, the better.
Investors will also be looking to see if you have the kinds of personality traits that make for a good founder and CEO. While there are lots of different characteristics they may be searching for, there are some that tend to be a given. For instance, passion. Investors need to know the person leading the business they put money into is passionate about the venture, and the industry it’s in. Passion is required to help draw people in, such as customers, job candidates, suppliers and journalists; and it is also necessary to help you get through the challenging times that crop up in business.
Another trait they’ll likely look for is adaptability. This is because many investors aren’t looking to be silent partners, but rather to have a say in how the business is run and moves forward. As such, they’ll be interested to see if you’re someone who is open to being mentored and advised. They need to know that you’re willing to keep learning new things; will take on board their ideas and those of others; and that you can adapt to changes in the market and in the business, too. People who are adaptable and flexible are also more likely to learn from their mistakes, and to realize they don’t know everything.
Have Relevant Paperwork and Plans in Place
If you want investors to feel comfortable backing your business, then they need to see what’s in it for them. That is, how will their investment be repaid, and how will they make additional funds, whether through interest or, more likely, growth in the value of their ownership stake over time? You need to prepare various types of paperwork and plans to have ready before you chat with investors.
For instance, you’ll need to have an up-to-date resume. This will help to give people an idea of who you are, what kind of education and experience you have, and why you are qualified to lead the business. Ensure your CV demonstrates the results you’ve achieved over the years, not just a standard list of job responsibilities. You need to make it clear that you can achieve what you set out to.
A detailed business plan is another must. Investors will be looking to discover if you have actually researched the market you want your venture to be a part of, and if you understand who your competitors are, what they offer, how they offer it, and so on. You must also understand the target demographic you want to sell your wares too, and have thought out the potential strengths, weaknesses, opportunities and threats for your organization.
In particular, investors will also be looking for financial projections. They’ll want to see how you plan to make money, what kinds of sales can be expected, what the profit margins will be, and how long it will take for the business to start making money. Your planning should also cover your key marketing ideas and overall marketing and sales strategies, plus the kinds of team members you believe you need to bring on board.