Any business need a steady flow of money to help it grow and expand. At some point, a company requires an external input of money to help it proceed to the next level.
It doesn’t matter if you are seeking for a Million USD in venture capital or a few thousands from your contacts, you need to nail down a few basics before you present your case.
Here are 6 prerequisites before approaching investors for any amount of money.
1. Get your team together:
An investor is always concerned about your ability to execute your plan. The facilitators to any execution is the people behind it.
Investors need to know they can trust you and your team, and hence they need to know your capability to keep your company afloat and to shoot to success.
2. Clear up your credit.
Having debts on your personal account will give the investor a doubt that you are not capable to paying off your debts and have problems with the responsible management of money. Have a clean financial track record to earn credibility and give them proof that your cash flow is healthy.
3. Have a detailed business plan.
You know your business plan in and out, but that is not enough when it comes to explaining it to your investors. Write your business plan with adequate and sufficient detail for your investor.
Make sure you include all the key numbers and dont be over optimistic with the numbers you provide.
4. Do your homework.
Know what kind of investment your company needs. Your financial needs should match your business strategy. Taking too much or too little money from investors will land you in a soup. Know where funds are available. A lot of people look for funding in the wrong places.
5. Create a list of ideal investors.
To have accepted financing, you need to realise it is a new relationship that you have taken on which could last you quite a while. Draw up a list of investors whom you know you would be able to share a good rapport with rather than just accept any money you get.
Knowing who you want to work with will help you be comfortable around them while pitching your business plan and asking for investment. Compatibility is key.
6. Keeping a Pitch Deck ready.
Be equipped with a well designed, top notch pitch deck. This will not only help you get your point across in a convenient and professional way of displaying your information, ideas and statistics; but also, give them a glimpse into your personality and the identity created for the company.
While we can’t help you anymore with the first 5 points, we can help you create the pitch deck of your dreams. Do let us know what you think about our article in the comment section below.