Fundraising is an exciting but very stressful part of starting any company. Requesting money now in exchange for potential future earnings is difficult because there is typically not much tangible collateral available at the time of the pitch; it’s all about the future and there’s a chance it could all come out to nothing. There are also so many startups running around nowadays that the competition for capital and investors is as fierce as it ever has been. In fact, many founders and owners of companies find that years after incorporation they are still trying to win over investors for various reasons. So exactly does one win over investors? The most successful people at doing this have a few common strategies and we’re here to talk about them today.
Getting investors to be as excited about your company as you are is one of the biggest factors in whether or not you will win them over. The importance of communicating to the investors that you’re passionate about what the company is trying to accomplish goes without saying, but at the same time you need to get feel that same energy. Why exactly is your fix to a given problem better than all the others, making it a “sure thing” for success? Why will the best minds in the field want to get on board to help your company climb even higher? The best way to communicate these things to investors is to plan what colorful, passionate verbs and phrases you will use, along with making the structure of what you are trying to say clear. Nothing kills the potential for successfully communicating passion like being unclear and causing confusion.
Be on the ball when it comes to your financials. Because investors, especially experienced ones, typically know the numbers side of other businesses similar to yours, trying to wow them with inflated or unrealistic numbers is not going to get you anywhere. You need to know the financial health of your company very well and be honest about what is going on so that investors can take notice of your honesty and authenticity. Again, just be very clear about how much money will be needed within what timeframe to be a “success.”
Lastly, remove as much fear from investors as you possibly can. It is only natural for investors to not want to invest their money in a company that is not going to provide any return or very little return. Remove this fear by planning ahead and putting yourself in their shoes: what would make you afraid to invest if you were them? What are other risk factors they may not even know about but will appreciate knowing that you’ve already thought about and planned for? What really makes your company stand out from others in the field? The less fear the investor has, the more likely you are to win them over.
Getting investors to be as excited about your company as you are is one of the biggest factors in whether or not you will win them over. The importance of communicating to the investors that you’re passionate about what the company is trying to accomplish goes without saying, but at the same time you need to get feel that same energy. Why exactly is your fix to a given problem better than all the others, making it a “sure thing” for success? Why will the best minds in the field want to get on board to help your company climb even higher? The best way to communicate these things to investors is to plan what colorful, passionate verbs and phrases you will use, along with making the structure of what you are trying to say clear. Nothing kills the potential for successfully communicating passion like being unclear and causing confusion.
Be on the ball when it comes to your financials. Because investors, especially experienced ones, typically know the numbers side of other businesses similar to yours, trying to wow them with inflated or unrealistic numbers is not going to get you anywhere. You need to know the financial health of your company very well and be honest about what is going on so that investors can take notice of your honesty and authenticity. Again, just be very clear about how much money will be needed within what timeframe to be a “success.”
Lastly, remove as much fear from investors as you possibly can. It is only natural for investors to not want to invest their money in a company that is not going to provide any return or very little return. Remove this fear by planning ahead and putting yourself in their shoes: what would make you afraid to invest if you were them? What are other risk factors they may not even know about but will appreciate knowing that you’ve already thought about and planned for? What really makes your company stand out from others in the field? The less fear the investor has, the more likely you are to win them over.
