With hundreds of thousands of investors in the US, entrepreneurs can be misled to believe that getting funding is an easy exercise. Unfortunately, it is not, and nothing significant may even happen after many months, even years. However, the experience shouldn’t be that frustrating and nerve-racking as start-up entrepreneurs become smarter with selecting and pitching potential investors. Below are helpful steps to identifying potential investors that are right for you.
Create a Winning Profile on Angel List and LinkedIn
As much as you want to get to know potential investors, you also want to come off as a professional and an expert in your field. So, get a professional profile on places where investors will likely be found, and get everything right. Don’t be sloppy about the way you present your business and yourself. Your profile should showcase your business, outline your business goals, and offer insights into your products and management personnel. You can make it easy for people interested in your area of expertise to find you by sharing your profile and asking professional acquaintances for references. Remember that when people follow you, your profile will be shown to those who follow them.
Create a Strategic and Relevant List of Potential Investors
This could be time-consuming, but it’s certainly more efficient than casting a net across hundreds of thousands of investors. For instance, if you are on Angel List, check the different categories and identify those investors who fall into your business category. You are looking for key players in the market segment you are focusing on and narrowing the list will be the first step towards a more efficient process. As a result, you will want to take a look at your market and find out if there are investors with a penchant for investing in products and services like yours before initiating contact. You can also reach out to fellow entrepreneurs and ask them for recommendations on who to pitch. They will certainly help you locate investors who are active in your area of interest and may not already be on your radar. Investors tend to give more credibility to deals that come through a trusted contact.
Get Third Party Feedback and Referrals
You already have a list of investors, but the odds are that you know very little how it feels like to work with each investor. Now is the time to comb your network and find out if you have common contacts with investors in your lists. Common contacts can tend to be very instrumental when it comes to hooking an investor as they can act as referrals, especially those who have had a business understanding or relationship with an investor. Investors will be more confident taking chances on a first-time entrepreneur if they are presented by someone who has already done business with them. You will be more effective if you do some research on them by reaching out to their social-media feeds and finding out their interests. You also want to avoid potential conflicts like pitching an investor who is actively funding a project for your competitor.
Get Your Pitch Right
Getting the list of suitable investors is important, but you will have to convince them that the risk associated with backing your startup is justified. Your pitch should be concise and effective, short and to the point, showcasing your knowledge, expertise and how you are going to get them a solid return on their investment. Have your deck ready, but be prepared for a more in-depth conversation should the need arise.
The above are some of the winning tips to consider if you want to hook the right investor for your business.