There are lots of articles and pieces of information online about the different routes you can take to find investment – and this is great, it’s important to understand all your options.
What’s harder to find is information on how to win that investment when you’re face-to-face with the investor. You can have the slickest introduction – but if your plans look shaky when it comes down to business, you can expect your meeting to be the last.
We’ll talk you through what you should be doing – before, during and after shaking hands with the person who’s there to talk money…
Strategy is everything
Great ideas are ten a penny. We’d probably have cracked colonising Mars by now if, as a species, we were as good at implementing ideas as we are at dreaming them up.
Having a strategy is the roadmap that takes you toward the realisation of your idea – without that map, you’re just another in the big line of people who can think.
Development of your plans is closely linked to creating your ‘brand’ – ask yourself what it is you’re trying to do and what it is that makes you different to similar services and products. This will give you a stronger understanding of many things – from your target audiences, to creating your first website with Think Zap one of the leading website design Glasgow companies.
There is no strategy that can anticipate every hurdle – but something well thought through will give you a very good idea of how much you’re looking for in terms of investment, a helpful piece of knowledge – investors don’t hand over blank signed cheques…
Make investment your business
Looking for investment shouldn’t be a secondary factor in your business development – if you require an injection of capital to get you off the ground, finding investors should occupy your thoughts at all times.
This needs to be done hand-in-hand with the development of your business strategy and planning – where you might ‘mind map’ an idea or list the boxes that need checking – get into the habit of adding ‘investors’ as a factor in everything you do.
This will help you consider how every step of your plan looks to someone who’s got the means to put some money into your business. It’s absolutely vital that you take this objective view – especially when you’re emotionally invested in your project.
Prove your research
Investors don’t work on hunches.
That’s not to say that don’t have intuition – but it’s rare that someone’s got into the position that allows them to invest significant capital without understanding what goes to make up that hunch or good feeling they have about you.
Numbers and facts do a lot of talking.
If you’re convinced that your product is going to appeal to a certain demographic, expand on why. Look at current market trends. Work out where those people live. Understand their buying process. Understand the timescales. Project the finances according to fact – rather than hope.
Save the plucking of imaginary figures and dreams of riches for when you’re drifting off to sleep, investors know that empirical evidence beats hopes and dreams every time.
Appeal to everyone
When you sit in front of someone who’s considering giving you money – you’re selling them your idea.
Assuming you’ve done your research into how people will buy your product, you’ll understand that there’s no one perfect sales pitch – where one person needs to crunch numbers there’s another person who just wants to play with the product.
At this stage, you’re probably only working with figures and words – so you’re going to want to make sure they appeal to the person you’re in front of. There will be some people who want a detailed document that they can take away – others will want a dynamic presentation with photos, animations and high-design.
Make sure you’ve covered all your bases – try to appeal to those who want solid facts as well as those who are going to need engaging in your passion.
Play the long game
In the real world, investment in your company isn’t going to be like Dragon’s Den.
In fact, you might not want to ask for money in the first, second or even third instance you meet – but that doesn’t mean you’re not working toward that final goal.
Imagine you’re walking your investor down a long corridor – when they get to the end they’re going to shake your hand and reach for their cheque book, but, the walk down there is long – and there are lots of open doors for them to disappear into as you move toward your goal.
Each of those doors represents an objection – and you’re not going to be able to start closing them until you know what they are. What’s more, your investor might not even know they have them yet!
Be prepared for a journey. Develop your plan while keeping potential investors in the loop – you’ll develop an understanding of one another – the foundation for a very positive business relationship going forward.
Honesty is key
It’s tempting to take a look at someone who’s talking about investing with you, check out their LinkedIn, get a feel for their companies and try to replicate the ways of thinking and working you think will fast-track you to a ‘yes’.
Be very wary of this approach. People who just say yes are ten-a-penny in business – and rarely worthy of investment.
Be yourself, let your passion for what you’re doing inform your interactions with potential investors. Like any relationship – if you start off pretending to be something you’re not, you’re potentially committing to a long time not being totally comfortable or authentic.
Don’t be disheartened by ‘no’
Unless you’ve cracked time-travel or harnessed nuclear fusion you’re probably going to hear ‘no’ a few times before you get a yes.
It’s easy to go home and let your head drop – but it’s really important you don’t. Remember, this is a long corridor before you see a cheque – so be prepared for objections.
No doesn’t necessarily mean a person isn’t interesting in your idea – so, finding out what it was that switched them off is really important.
You won’t get this info from everyone – but if you do, ask what would have changed that decision to a yes. It might be that you’ve just not communicated things adequately – meaning you get a second bite at the cherry before ticking that person off the potential investors list and moving on to someone else.
At the very worst you can take this info away and reflect on it. Consider the merits of changing your angle slightly.
Don’t go rushing back with your pockets turned out telling an investor you’ve changed your mind, instead, take their suggestion back to the research stage. If it’s feasible you might want to approach again, with the appropriate research – this level of adaptability and business agility might even be enough to impress on its own…