Are you an entrepreneur looking for investment? If yes, then you know how tedious the task of attracting potential investors might be. This article will give you 8 practical tips on how to warm up potential investors and make getting an investment a little less intimidating.
Make a Connection with Your Business Card
When you're out there networking with other investors, make sure you exchange business cards with your mail/LinkedIn info. It might sound simple, but trust me, it's crucial. I know it can be stressful, but you must push yourself to hand out many business cards after the meetup.
And here's a pro tip: take it a step further and ask if they'd like to be included in your mailing list. This way, you can keep them updated on your startup's performance without overwhelming them with information. It's a great way to build relationships and keep your investors in the loop. So remember to grab those business cards and make some connections!
Don't Overwhelm Them With Updates
First and foremost, it's essential to establish a communication channel that works for everyone involved. This could be a weekly or biweekly email, a monthly report, or a face-to-face meeting. Whatever you choose, ensure you and your investors are on the same page about how often they want to hear from you.
While keeping your investors informed is essential, you don't want to overwhelm them with too much information. Sending too many updates can be counterproductive and make you seem pushy or desperate. Instead, focus on relaying relevant information in a concise and easy-to-digest manner. This could include celebrating successes, addressing concerns they may have raised, and sharing your plans for the future.
Remember, your investors are on your side and want to see you succeed. So don't be afraid to reach out and share your progress – just make sure you do so in a way that respects their time and attention.
Keep Communication Consistent
Investing is a relationship decision; consistent communication is key to building and maintaining that relationship. Keep sending proactive updates about your company's traction and growth, such as new hires, customer acquisition, and revenue milestones. Investors will appreciate staying informed and will be more likely to keep you in mind for future opportunities.
Focus On Company Momentum
If you want your startup to be noticed by investors and customers, you must be proactive on social media and build a recognizable brand. This is crucial in getting your business off the ground and making it stand out among other startups.
When it comes to PR, it's essential to focus on building momentum for your company. That means generating positive news and coverage in top-tier publications that concentrate on your industry. This can help build investor and customer confidence in your business.
To showcase your company's successes to the investors, consider sending a quarterly update with the best publications about your company. Doing this lets you keep your investors engaged and excited about your company's potential.
Take The Time To Build Trust
As a young and unproven entrepreneur, it can be tough to get your foot in the door. But don't let the initial rejection get you down! Sometimes an investor can become interested in your project after a few updates, but sometimes it can take a few years!
Here's what you can do: keep the investors in the loop by consistently updating them on the metrics that matter most to them. Whether it's customer acquisition or revenue growth, show them you're progressing toward your goals. By delivering on your promises and being transparent about your progress, you can earn their trust and build a solid relationship based on accountability and transparency.
Nurture Them Like Sales Leads
Raising capital is a sales process; just like with sales, you must run a specific process. Move investors through your sales process one compartment at a time and lock off the previous compartment, so they don't go backward. Track where everyone is in your investor pipeline, and then nurture them. Consider sending a biweekly newsletter that highlights significant progress and milestones.
Try To Connect At An Upcoming Event
Nothing beats face-to-face interactions when it comes to networking and making connections with potential investors. Emails and phone calls can only get you so far, but meeting someone in person can make a lasting impression.
Here's what I suggest: research and find out if any upcoming social events, meetups, or conferences in your niche are happening soon. Reviewing social media accounts can provide hints about the plans of investors. And if you're going to attend any event, make sure you mark it on your social media accounts! This will give potential investors a heads-up that you'll be in the same area, and they might even reach out to connect with you.
And when you meet someone in person, keep the conversation flowing and have some fun while at it. You never know where a casual conversation might lead!
Share Only What's Completed
Hey, buddy! Here's a hot tip: Don't give away too much too soon when you're trying to raise money for your business. You want to build some intrigue and “lure” potential investors to your calls.
One way to do this is by sharing completed milestones instead of just talking about what you plan to do in the future. It's all about showing your track record of success and giving investors a reason to believe in you.
So, instead of saying, "Hey, we're going to close a big deal in two months," say something like, "Our metrics have grown significantly, and I'd love to share with you our plans for the future on a short call, where do you have free time?" Remember, investors want to see that you can deliver on your promises. By sharing completed milestones and leaving a little mystery, you'll be much more likely to get them on board.
By following these tips, you can build trust and accountability with potential investors, increasing the chances of securing the funding you need.