Many businesses have amazing ideas, but can’t seem to sell themselves to investors. Investors may hear a hundred pitches or more in a given week and may choose one of them. The entrepreneurs who are most likely to get funded know what investors are looking for and cater to their expectations.
Here are a few things you need to do to stand out to an investor and maximize your chances of getting funded:
- Sell yourself first. When you are looking to get funded, make sure that you can convince an investor that you and your team are the best people to take on a particular startup. Even if you have a completely original idea, investors will probably guess that another entrepreneur has already come up with it. That is why you need to sell yourself before you can sell your company.
- Provide an engaging description of your business. You are really covering two bases here. Investors want to see that you are passionate about what you are doing. They also need to know that you a clear concept of your business and where you plan to take it.
- Show that you have done your research. Investors only have confidence in entrepreneurs that can back up everything they say. Don’t think that you can fill your business plan with assumptions and disguise them in a pretty package. Shrewd investors are going to look into everything you say before they give you a cent. Make sure that you explain if you made any assumptions and why you needed to make those assumptions. Investors don’t want to invest in someone who should be writing science fiction novels instead of running a business.
- Show a clear vision of where you want to be in the next few years. An investor is only going to invest in a company that is going to yield a return on his investment. If he can’t be sure that the investment is going to pay off for him, he will tell you to stop wasting his time. He isn’t going to have any faith in your company if you aren’t motivated to take it to the next level.
- Make sure that you are prepared for each phase of the process. You are going to start off getting the attention of a potential investor with a few opening lines, but that isn’t going to be what ultimately sells you. When they ask for your business plan or any other information, make sure that it is ready for them right away. If you make them wait long enough, they will probably move on.
- Never assume that getting funding will be easy. Every entrepreneur will have their work cut out for them. If you have a more unusual business such as my Medifast coupons and Nutrisystem discount site, you may have to work even harder if you ever need funding. If they are going to have a hard time seeing a purpose for your business, you will have to work even harder at it.
Looking for funding is competitive and difficult. Before you can go about it, you need to make sure that you have all your ducks in a row. You will probably still get more rejections than offers for funding, but you can increase your chances significantly if you are prepared and understand what investors are looking for.
Kalen Smith is an internet entrepreneur and holds an MBA in finance.
