If you are a small business owner looking for venture capital you may be wondering where to look for start-up capital and how to attract and impress potential investors. It can seem like an uphill battle trying to get your business off the ground, or to get money to expand. Let’s discuss some sources of venture capital, and how you can impress any potential investor to find funds for your small business.
Where to Find Venture Capital
There are many sources of funding that are available to you as a small business owner. Some traditional forms of financing that you may have already thought of are banks, credit unions, and inviting family and friends to invest. These are all tried and true methods. You may also want to consider meetings with investing clubs or venture capital firms that specialize in helping small businesses get off the ground or expand through new products or opening new locations. All of these are effective ways to obtain money for your business.
Now that you know some sources of funding your small business, another important aspect of obtaining capital is also about knowing how to impress potential investors.
Be Prepared For Anything
You never know when an opportunity may arise and where you could come across a potential investor for your business. You always need to make sure you are prepared to discuss your business in a professional light, and if need be, to give a pitch about your business. Make sure you always have an up to date copy of your business plan, a snapshot financial report and a couple of intriguing stories about your business. This will ensure that you are ready if you meet someone who could be an investor in your business.
Your Presentation Needs to Shine
The presentation that you deliver to potential investors needs to be top notch. It doesn’t matter if you are presenting it to a bank loan officer, credit union, or friends and relatives. They all deserve to see a polished, professional presentation. It might be a good idea to have your presentation materials professionally designed and printed, if you can afford it. Make sure all the data in your presentation is accurate, and you know the information from memory. You need to build trust with potential investors. Remember to show the benefits of your business, while still being honest about the daily operations.
How You Dress Matters
You would never want to lose an opportunity and the capital that you need for your business, because you looked sloppy and unkempt. Similarly to the presentation, you must always be prepared when dealing with everyone in regards to your business and dress your best. This doesn’t always mean a suit. Also, a person’s decision to invest will probably not be swayed by your decision to wear the red or the blue tie; but you must look professional. Treat it like you were going on a job interview. Clothes that are clean, pressed, and in good repair will always give a good impression.
Ask for Less Money
You may be tempted to ask for a significant amount of capital from an investor because you’re not sure how long it will be before you will have another willing investor. It is actually more effective if you ask for less money, and have a larger pool of investors, than to ask for large investments from the people that you meet with. It’s important to remember that they are taking a risk with their money as well and you need to make sure you respect this with the amount of the loans you request.
Finding investors for a small business isn’t easy. It can be difficult to persuade people to invest and to hold onto investors. In order to maximize your chances of success, you need to do several things. You need to diversify your sources of financing and consider all possibilities and be prepared when they happen, you need to have a great presentation, and always dress like a successful business owner. If you follow the advice laid out here, you should have no trouble being able to impress potential investors and find venture capital for your small business.
This article was written by Phil Steel, an outsource consultant who offer services like bookkeeping, accounting, audit, payroll management, and much more, for fast growing companies to meet their financial needs.