Getting people or entities to back your idea is never easy. Whether you’re looking for an angel investor or a venture capitalist, you need to bring your a-game throughout the process. The success of your business depends on it.
We now know that only 50% of small new businesses survive after five(5) years in business, and the businesses in this percentile get a couple of things right, from the initial stages.
From making sure your business idea will hold water, getting the right people interested in it, and convincing them to invest, there are many areas where things could go wrong.
This is a guide to help set you up for success, take a look.
Validate your Idea
There’s a lot of excitement when you first get your idea. At this point, you think it’s brilliant, and it’s going to change how people do things. You may very well be right, however, you still need to find out for sure. The emphasis here is finding out if people out there would pay money for your product or service.
Before you bring your product to market, you want to have solid data, backing the fact that there is a viable market for your product.
The first thing you need to figure out is what problem your idea solves. Then you want to go ahead and test it out with real people. Keep in mind that the acquired data will come in handy when you’re eventually pitching your idea.
Find the Right Investor
This part of the startup journey is where a lot of entrepreneurs get stuck. This is most likely why most entrepreneurs turn to their savings to fund their businesses.
The right investor can be of tremendous value to your business. Not just in the area of funnelling money into your business, but they can also help you with industry connections and knowledge acquired from years in business.
Unless you’re extremely lucky, no one with the kind of capital you need is going to come up to you and ask what you’ve been up to. Thankfully, with online funding platforms, social media and other channels, modern entrepreneurs have several options for seeking out investors.
Research Your Potential Investor
One important thing you have to remember is that your potential investor will only invest in your business if it looks like an attractive prospect. This is why you need to know exactly what the investor looks out for in a portfolio company.
Take out a significant amount of time to do your research. Again, the information you’re able to attain will help you out in your pitch. Before you go in, you need to know if they have a history of investing in or have an interest in your business niche. This will make for a more pleasant pitch experience for all parties involved.
Create an Awesome Pitch Deck
Your pitch deck is where you showcase your business proposition to the investor. There are a few key things that you must have in your deck. These include the problem, the solution, the market, the product, the customers, and the business model. There are some awesome templates you can check out, for decks that have worked for other companies.
You also need to make your pitch deck stand out. Try to make sure there’s a flow to it, a bit of magic. Something to grab the attention of the investor. You want your pitch to be memorable. You want the investor to believe your business could be a profitable venture.
Present With Confidence
Presenting with confidence is key. Investors are not just buying into your business. They’re buying into you. This means you have to command the room, get and hold their attention, then proceed to sell your business idea.
Even if you are typically not comfortable speaking to an audience, there are tips you can use to make sure your presentation goes on without a hitch.
Prepare For Questions
Lastly, prepare to answer questions. Think of the Q&A session as the part of your pitch where you close the deal. If a potential investor has a lot of questions for you, and they like the answers they’re getting, their interest is being piqued.
This is where you can display in-depth knowledge of the business you’re going into. This means you need to have immersed yourself in the different aspects of the business.
These are some questions you may be asked, with these you know what to prepare for.
Going into a new business is never easy. There are a lot of unknowns you will face. However, nailing your pitch is a great way to kickoff. Not only do you get the capital you need, but you could also now be paired with someone or people who have been around long enough to show you the ropes.
Remember to test your Idea, do proper research, tell a compelling story with your deck, and prepare for questions that may be asked.