Serial start-up founder James Hind gives his top tips
Securing funding can be just what a small business or startup needs to accelerate growth, but getting investment is by no means a walk in the park. It is, however, a very real possibility for your company and there are plenty of venture capitalists (VCs), angel investors and equity firms out there who could be interested in your brand.
There are certain steps you can take to make your business more attractive to investors and all you have to do is be willing to give them a try. Go on, you know you want to…
Have a plan
No matter how good your business idea or brand concept is, an investor will want to see evidence of a tangible growth plan. This will reassure them that you have thought about the future of your company and how you’re going to scale the business; subsequently making you a more attractive investment prospect.
Invest in yourself first
You’ll impress potential investors if they see that you’ve bootstrapped your business in the beginning. It will prove that you believed in your idea enough to put your own money behind it, which will show commitment and encourage investors take you more seriously.
Investors won’t just look at you and your business idea when considering whether to invest in your company; they will also look at the team you have built. You may only have a handful of employees, but the investor needs to have faith in them; so, making sure you have the right talent and skilled individuals to drive your business forward is key. Don’t just employ the first person who applies for a role.
Make the first move
Unlike first dates, making the first move when trying to secure investment is not frowned upon. You shouldn’t wait for investors to come knocking on your door; instead, go looking for them. Research investors who have already backed similar businesses to yours, because they’ll have better knowledge and experience of your sector. Remember, you’re not just being given money, but a listening ear when you need advice.
Don’t give up
Raising investment is not a quick process and you have to accept that you might not be successful straight away. It’s not a race though and there’s certainly no rush. Having patience when raising investment is very important and potential investors will easy spot an entrepreneur who is determined.
Perfect your pitch
Securing investment is likely to involve some kind of pitching process and, as all your school teachers probably told you, practice makes perfect. Even if you know your business and future plans inside out, it’s normal to draw a blank when put on the spot if you haven’t prepared what you’re going to say.
There you have it; six points to consider if you’re hoping to attract investment for your business. It’s not always easy, but it’s definitely always worth it.
James Hind is the founder of www.carwow.co.uk, a London start-up enabling users to buy cars by comparing offers by price, location and reviews of dealerships from other users. To date, carwow has raised more than £18m worth of investment; most recently £12.5m led by Accel, backers of Dropbox and Spotify.