There might come a point in your life as a business owner when you need to attract investors because you can’t move forward with your plans and next steps until you do. There’s no shame in that; it’s what a lot of businesses need to do, and ignoring the fact that you’re at a standstill because of a lack of funds isn’t going to help you at all.
Of course, you can’t just go and ask someone for money if you want to have a successful outcome (it might work, but the likelihood is that it won’t, and because you only get one go at making a good first impression, it’s better to think things through and make sure you get it right). Instead, you’ll need to ensure your business is an attractive proposition for any potential investor. Remember, it’s highly likely that you’ll need them a lot more than they need you, and there could be a lot of people clamoring for the same money, so the more you can do to make a good impression and show you’re the right investment opportunity, the better. With that in mind, here are some great ways to attract investors to your business.
Have A Good Story
When you think about it, all businesses are pretty much the same, or at least incredibly similar. They might not sell or provide the same things, but the way they’re run and why they were set up is generally a familiar story. So don’t tell the potential investor that story (the one they’ve heard a million times before); tell them your story.
The thing to remember is that when you’re trying to convince someone to do someone, whether it’s investing money in your business, buying from you, or anything else, you need to create an emotional connection. Once you do that, you’ll be able to ask them for things you wouldn’t have been able to otherwise, and they’re a lot more likely to say yes. That’s why the story you tell has to be different, unique, and yours. So let the investor know how hard it’s been (without turning it into a sob story, as that won’t help and could make them decide not to invest at all), what challenges you came across, and how that’s made you more determined to push forward, for example. Make sure you explain your commitment to the business and how it can solve real problems too.
When you’re presenting to the investor, just telling your story might not be enough, however, which is why it’s a good idea to use some other elements like videos, infographics, slide shows, and perhaps even interviews with customers. The more proof you can offer about your story, the better it will be.
Work On Your Business Plan
If the investor is captivated by your story, they still might not hand over a check right away (and a savvy investor certainly won’t), although they will be more positive towards you, and they’ll want to know more. This is where your business plan is going to be crucial, and you’ll need to work on it to make sure it’s as good as it can be well before you’re in front of an investor hoping to persuade them that your business is going to give them a good return in their money.
Although the entire document is an important one, the sections that really need to be watertight are those dealing with your finances and where you intend the business to go in the future. They have to be absolutely accurate, and you need to show where you’re getting all your figures from because the investor is going to drill right down into those figures themselves, and if there are any issues, they’ll soon find them.
With a good business plan in place, you’ll be able to show any investor that you’re prepared for the future and that you’ve thought things through, ideally having contingency plans in place, just in case. You’ll also be able to give them a full insight into where their money would go, ensuring they feel comfortable enough to invest.
Show You’re Compliant
Investors aren’t just interested in the potential returns on their investment (although that is going to be massively important to them), but also in how stable and long-lasting your business is. The last thing they’ll want is to invest a decent sum of money into a business that can’t be sustained and has too many issues to move forward with, no matter how much cash it’s injected with.
That’s why you need to show investors that your business is completely compliant in terms of the law, finance, ethics, privacy, cybersecurity, and much more. Although it can be a complex area to get into, compliance is crucial even if you’re not looking for an investor, and if you are, it’s non-negotiable. As we said above, checks will be carried out, and if anything looks untoward, that money isn’t going to be forthcoming.
Make sure you have a good understanding of all the compliance your business needs to get right, and put measures in place to ensure you’re doing the right thing. That could be anything from getting the best PDF SDK so your documents are encrypted and can’t be altered to getting specific certifications needed to show your business has ticked all the boxes. There will be some compliance measures that affect every business and some that only affect your specific sector, and you’ll need to make sure both are in hand.
Build A Strong Online Presence
These days, no business can really go anywhere without an online presence like a website and social media profiles. And if that online presence is particularly good, then that’s even better because you’ll be seen by more people, and that will bring you a lot more customers, more sales, and, importantly, more profits. Plus, having a strong online presence shows that you’re taking your business seriously, and if you can engage with people, it’s proof that you’re intent on growing the business and getting as many customers as possible.
The first thing you’ll need to do to make sure your online presence is a strong one is to work on your website and check that there’s good SEO practices being done, you’ve got interesting content on it, and it’s easy to navigate, among other things. Only once your website is ready should you expand on that and move on to your social media accounts. The whole point of social media is to get people to become more aware of you and then guide them towards your website so they can spend money, and if your website is a disappointment, it won’t matter how good your Facebook or Instagram posts are or how much fun your TikTok videos are, no one is actually going to spend their money with you.
Getting all this in place and gathering a good following of loyal customers is a great way to show investors you mean what you’re promising them and that you’re working hard on making your business something that will stand the test of time.
Network Well
Networking can make a big difference when it comes to attracting investors to your business because it’s all about building relationships. Right at the start of this blog post, we mentioned how it’s important to make an emotional connection with your potential investor and how you can do that through storytelling. Well, the good thing is that you don’t have to wait until you’re standing in front of them during your pitch or meeting; you can start making that connection much earlier, and you can do it through networking.
The great thing about this is that it can all come about organically, and you don’t have to prepare anything in advance – you’ll just be talking to various people about your business, and they can be the ones who’ll tell you if they’re interested in investing. That makes it a lot less pressured and simpler to do for even the most nervous of business owners.
Even if no one specifically wants to invest after chatting and networking with you, you might find yourself with some mentors who can help you get ready for other investors – although it might not be the outcome you wanted initially, it’s certainly not a negative thing if that’s what comes about.
Target The Right Investors
Finally, one very important thing to do when you want to attract investors to your business is to target the right investors in the first place. If you’re trying to get people who just aren’t ever going to be interested in what you do because it’s something they have no expertise in to invest in you, you’re just wasting your me – and their time as well. That’s not fair on anyone, especially as you could be using that time to target people who are more likely to invest in you.
You’ll have to do a lot of research to determine who it is that’s going to make the difference to your business by investing, and some of the things to look into include what they’ve invested in before, how much they invested, how hands-on (or not) they were, and what their track record for success is. Not only will this help you decide who to speak to, but it also shows the potential investor you’ve done your homework, and you’ve chosen them specifically, helping them feel more positive towards you.
