Advice For Securing Investment For A Start-Up
Perhaps the biggest hurdle that entrepreneurs face when they are looking to create a start-up is securing investment. The majority will need a cash injection in order to get the ball rolling, but this is can be very hard to achieve and particularly if you do not have much experience or many contacts. First, you must find potential investors and then persuade them to part with their cash – a feat that is easier said than done! With this in mind, here is some advice for securing the right kind of investment so that you can turn your idea into a profitable business.
A comprehensive and carefully thought out business plan is an absolute necessity when pitching to investors. You could be the most charming and persuasive entrepreneur on the planet, but if you do not have a business plan that details every aspect of the company and establishes a clear vision for the future then they will show you the door.
Communicate Your Vision
You must also be able to clearly communicate your vision for the start-up and show your passion. This is something that some people are better at than others, but if you struggle to communicate then make sure that you know your business plan and strategy inside out so that you can confidently answer any concerns that they may have.
Establish A Realistic Budget and Forecast
It is no good meeting a potential investor and dazzling them with a great start-up idea but not knowing how much money you need to get the ball rolling. Carefully account every aspect that you will need financial support for in the first year, and show how you have reached these figures. It is also worth showing how the business will grow in the next few years so they can see what is in it for them. Many modern investors use robo-advisors like Betterment to make decisions, so the numbers will need to be sound and show that it is a sensible financial move.
Utilize Social Media
Social media is a great tool for entrepreneurs looking to connect with investors. Use channels like Linkedin and Twitter to connect with investors, show your personality and test the waters. It can also be a helpful tool for getting to know an investor before meeting with them face-to-face.
Much like giving an important presentation, it is vital that you carefully practice your pitch so that you know it like the back of your hand when you get the opportunity to speak to a potential investor. It can be scary, especially if it is your first time, which can make it hard to remember, so take the time to go over it and practice giving it to friends and family for support and feedback. Make sure that it is clear and concise so that they do not lose interest halfway through.
Securing investment is crucial for most entrepreneurs looking to launch a start-up, but this can be hard to achieve and especially if you do not have much experience or many contacts. The above should help you to pitch with confidence so that you can get the funding you need for what will hopefully be a profitable business idea.