Whether you’re starting a new business or already running one, there always comes a time when you need extra financial support from investors. It could be that you need money to fund a business expansion project, to finalise and market a new idea or prototype, or to save your business from collapsing. Regardless of the reason, attracting investors to your business is about making a convincing case that an investor will make worthwhile returns from your business. The following tips can help you make that case.
1. Perfect your idea
The last thing you want to do is meet investors unprepared, especially when you want them to sponsor a new product. You need to spend enough time perfecting your product to ensure its uniqueness is attractive to investors. You may need to conduct thorough research and work with the right experts to achieve this. For example, if you’re looking to create a bespoke design of a unique, tailor-made engineering project or equipment, it’s best to work with experts in the field. For instance, an expert like a mechanical engineering consultant is experienced in designing and arranging the manufacturer of just what you need. The better your product looks, the easier it will be to convince investors.
2. Show the raw data
If you have a new idea or invention yet to be tested on the market, it can be tricky to convince investors to support it unless they see massive potential. Therefore, you need to prove that your new idea solves a need that target consumers have and are willing to pay for. Or you need to demonstrate that there is a huge market ready for your invention. And that involves a lot of research on your part. Find out how much your target market is willing to pay, your revenue projection, and how much your potential investor can expect to walk away with long-term or short-term. Some of the most important data investors look for is your current financial performance and how much you need in investment support.
3. Device the perfect pitch
Putting together a winning pitch is one of the most extensive and nerve-racking parts of convincing investors to buy into your business project or idea. For your pitch to be convincing, it must include all the information a potential investor wants to know.
First, explain your idea, product, or project. Next, explain how it affects or serves the masses. If your project is not a novelty, you may have to explain how yours makes you or your business stand out from the others.
4. Be transparent
Most investors will prefer to look at your business books before they make a decision. Although this may be frustrating for you, it is a vital step they must take. This is to ensure that they are making a profitable decision. So, be transparent. If a potential investor asks for financial statements, consult with your financial advisor or accountant to review all bank statements, tax issues, and other financial documents, be sure to make them readily available.