Need to Raise Capital?How to Achieve Your Goals
If you are an entrepreneur looking for capital to take your company to the next level, understand these 10 important steps.
Why? Because investors know that most start up companies fail and most innovative ideas do not result in successful revenue production.
Understand that finding willing investors takes work, patience, persistence and personal commitment.
Always be concise.
Every investor receives many investment requests.
It is critical that every, single thing you say and write be short, clear and complete.
Your initial communications should be one or two pages.
Your elevator pitch which is your verbal overview should be no more than sixty seconds and leave the investor wanting more information.
1.
Be realistic.
Projections that are beyond your capabilities will result in the investor simply ignoring everything you say and write.
Investors hear every day how companies will be worth a billion dollars.
Make sure you have solid facts to back up your statements.
2.
Be confident.
You must be totally convinced of your own plans and path to success.
Your confidence must shine through every communication with potential investors.
3.
Be committed.
You must be completely immersed in your business.
It must be your full time job 24/7.
4.
Be knowledgeable and know specifics.
You must be ready to answer every question investors ask.
Be ready to defend how much capital you will need, how much your company is worth today and use of funds -- to the dollar.
All answers must be complete and non-technical, yet short and concise.
Write a business plan with an excellent executive summary.
5.
Be ready to answer these three questions.
1)What makes you different, what makes your company a good investment? 2)How much money will you need and what do you need if for? 3)What is the expected ROI and exit strategy for the investor? 6.
Be aware of your competition.
Know exactly who your competition is and what they are doing at all times.
Know why you are better positioned.
Explain where your industry is going and how you will get there first.
7.
Be passionate.
Investors will look at you first, and then your management team.
Be prepared to first sell yourself, then your team and idea.
Know and be ready to clearly illustrate your past successes.
Your passion and knowledge is the foundation for all of your investor presentations.
Demonstrate it at every opportunity.
8.
Have skin in the game.
Investors are going to want to know that you personally believe in your company and that you have invested in it yourself.
Be prepared to show how you have invested in your company.
9.
Know which investors you should approach.
There are investor types and classes for companies at every stage.
Understand the stage of your company and what investor sources you should approach.
The typical investor course is: a.
friends and family, b.
angels, c.
venture capital, private equity or strategic capital funding sources, d.
pipe funding (if your investor exit involves going public).
10.
Select only the best advisors.
Make sure the advisors you hire are qualified, experienced professionals.
They should, give references you can call, be invested in their own deals, know the language, have owned and operated their own entrepreneurial ventures, be properly licensed and be able to demonstrate all of the above while also providing testimonials and/or referrals.
Why? Because investors know that most start up companies fail and most innovative ideas do not result in successful revenue production.
Understand that finding willing investors takes work, patience, persistence and personal commitment.
Always be concise.
Every investor receives many investment requests.
It is critical that every, single thing you say and write be short, clear and complete.
Your initial communications should be one or two pages.
Your elevator pitch which is your verbal overview should be no more than sixty seconds and leave the investor wanting more information.
1.
Be realistic.
Projections that are beyond your capabilities will result in the investor simply ignoring everything you say and write.
Investors hear every day how companies will be worth a billion dollars.
Make sure you have solid facts to back up your statements.
2.
Be confident.
You must be totally convinced of your own plans and path to success.
Your confidence must shine through every communication with potential investors.
3.
Be committed.
You must be completely immersed in your business.
It must be your full time job 24/7.
4.
Be knowledgeable and know specifics.
You must be ready to answer every question investors ask.
Be ready to defend how much capital you will need, how much your company is worth today and use of funds -- to the dollar.
All answers must be complete and non-technical, yet short and concise.
Write a business plan with an excellent executive summary.
5.
Be ready to answer these three questions.
1)What makes you different, what makes your company a good investment? 2)How much money will you need and what do you need if for? 3)What is the expected ROI and exit strategy for the investor? 6.
Be aware of your competition.
Know exactly who your competition is and what they are doing at all times.
Know why you are better positioned.
Explain where your industry is going and how you will get there first.
7.
Be passionate.
Investors will look at you first, and then your management team.
Be prepared to first sell yourself, then your team and idea.
Know and be ready to clearly illustrate your past successes.
Your passion and knowledge is the foundation for all of your investor presentations.
Demonstrate it at every opportunity.
8.
Have skin in the game.
Investors are going to want to know that you personally believe in your company and that you have invested in it yourself.
Be prepared to show how you have invested in your company.
9.
Know which investors you should approach.
There are investor types and classes for companies at every stage.
Understand the stage of your company and what investor sources you should approach.
The typical investor course is: a.
friends and family, b.
angels, c.
venture capital, private equity or strategic capital funding sources, d.
pipe funding (if your investor exit involves going public).
10.
Select only the best advisors.
Make sure the advisors you hire are qualified, experienced professionals.
They should, give references you can call, be invested in their own deals, know the language, have owned and operated their own entrepreneurial ventures, be properly licensed and be able to demonstrate all of the above while also providing testimonials and/or referrals.
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