Investors can make or break a startup company. The right investors will help you build a foundation of solid ideas and advice, as well as providing financial backing for your startup. A bad investor can lead you off track and leave you in frustration. Knowing how to attract the right investors for you and your startup will make the difference between profit and problems for your startup.
Network Before You Need Money
Develop connections with potential investors before your startup is in desperate need to financial backing. This gives you more time to research investors and cultivate those relationships without the extra pressure. Once you’ve established a connection, the investors will be more likely to partner with your startup.
Practice Your Pitch
Practice your elevator sales pitch. When you’re networking and meeting potential investors you will have seconds to impress them. Keep it brief but make it personal. Don’t go into a full-on sales pitch and don’t ask for money right away. Use this opportunity to share your enthusiasm and explain why they should be excited too. Once you’ve captured a potential investor’s interest you can arrange a meeting to go over details.
Good communication between you and your investors is essential to a successful relationship. Missed calls and unanswered emails are a sign that you or your investor is not interested. Prompt responses are the first step to good communication. Also remember to present your ideas, questions and concerns openly. Both parties need to be fully informed for your business to be successful. Regardless of what media you’re using, be professional in your correspondence. This shows potential investors that you value their time and you take your business seriously.
Don’t Be Afraid to Walk Away
As an entrepreneur, you want to get your business running as soon as possible. It can be tempting to welcome any and all potential investors but think about your long-term goals. If a potential investor doesn’t share your passion for your startup, consider waiting for the next opportunity. Investors will have their own ideas about how to develop your business. If they don’t appreciate your vision, you will both end up frustrated. At the end of the day, your startup is your dream. Find partners who will make that dream a reality.