Time and again we have been discussing start-ups but never about investors. These are the backbone of a successful business, and you must have all the knowledge about them before reaching out to anyone.
In order to make you a better deal maker we have come up with some information over where to find your first investor.
Through business schools
To start with, you can contact the nearest business school or an entrepreneurial program. In the majority of cases, these institutions have a strong association with investors and entrepreneurs from their alumni and guest speakers. If your project is worthy, they will be more than willing to connect you with desirable people.
The internet is home to almost every solution and getting an investor is no exception. You can look out for opportunities on Microventures, AngelList, LinkedIn and other such websites. Some lucky ones have also been able to meet investors through Quora.
But, online sources can be fishy and demand maximum alertness. Again, you will find it hard to establish your credibility online. Nonetheless, it is a good option to work on as you can get investment from an international source or from various investors at once.
Through your contacts
There is a high probability that you might know someone from the industry you are trying to break into. Use these contacts to reach people who are capable of funding you. You can also use their recommendations as a kick start for your business as being an outsider your chances of getting investment are comparatively slim.
Work hard to make a new connection by visiting start-up meets and joining various groups focused on entrepreneurship.
You can also gain success by getting in touch with an Angel investment group which works as a member-based association according to your location. They are more likely to invest in your project through an operating fund amassed by some investment firm. These firms use these Angel networks to get new deals under a mutually beneficial relationship.
To your astonishment, better projects can get offers from hundreds of investors at a time. You can use this situation to bargain for the funds and even ask numerous investors to work together.
Crowdfunding is a great way to take token funds for your company through smaller investors. There are many crowdfunding platforms specific to science, arts, business, etc. We essentially advise this process to people who are exclusively looking for seed funding.
Such a capital gaining option is better for businesses which are actively participating in the industry or for entrepreneurs who do not like investors nagging their way through the company’s management. This option is also feasible for people who are extremely good at marketing and maintaining social relationships.
Prove your worth
It does not matter who the investor is; they will only fund your project if you show them your value. The best way to dos so is by perfecting your prototype and having a likely cost to sales figure. You can add additional impact by developing a decent brand name or a huge presence over social media.
Investors are interested in your product if you prove that your product has a market, you need nothing else. Always have a tight grip on your business model and prepare answers to defend it. Remember, big investors, are only interested in projects which are more likely to succeed.
Undergo a research
People who are able to get the best investment deals are always open to options. They know about the current status of the market through extensive research work. It not only helps them in understanding the industry and its drivers but also prepares a long list of potential investors.
There are thousands of VC firms around the country, and you have to compile a list of top 50 potential investors. Capital investment is a big game and should be dealt with precision and intelligence. Get in touch with these players, pitch your idea and ask for feedback. Moreover, if you are not able to succeed then use their recommendations in your next meeting.
In this manner, getting investment for a start-up is a lot harder than you might think. But, it is not impossible as a huge crowd of investors is looking forwards for better products. It’s time that you take the above-mentioned steps and approach them systematically.