Raising funds for a startup or an established business is always a challenge. But with the right preparation, it can be a manageable and even enjoyable experience. Whether you’re targeting funds or angel investors, there are many ways to attract investment. In this blog post, we will discuss how to prepare yourself for a pitch, target investors, promote your business, keep existing investors happy, and set yourself up to take on investment.
Prepare your pitch
Before you start approaching investors, you need to make sure you have everything in place. This includes a pitch deck, executive summary, and – only if it will support you – a presentation deck for meetings.
If you don’t know where to start, take a look at DocSend’s assessment of decks from top companies like Uber and Buffer before taking your content to Pitch Space, which will help you create your content and generate a nicely designed document for you. Also take a look at this article written by our founder, John Auckland – it provides some useful tips and insight on how to create the perfect pitch deck.
Target investors
Building a hit list of potential investors is crucial. You can start by researching funds and angel investors relevant to your sector.
Not every fund will be suitable for your stage or sector, so make sure you do your research to see how you fit in and complement their portfolio. They can also take a long time to come on board and the due diligence process can be extensive. So, it’s crucial that you’re not only putting your best self forward from the start, but you’re kicking off the process early and have all of the relevant information to hand.
To find angel investors, you can use databases such as Crunchbase and platforms such as AIN. Leveraging your network is also a great way to find potential investors.
Promote your business
Creating a buzz around your company is pivotal in making it an exciting prospect for investors. You can do this by using PR, social media, and customer engagement events to your advantage.
Through PR, you can showcase your company's milestones and achievements to boost its validation and establish it as a trustworthy and successful brand. Writing knowledgeable pieces on relevant industry topics can also position you as a thought leader and build trust with your target audience.
To demonstrate your commitment to connecting with your audience, actively engage on social media. Ensure your social media pages, posts, stories, reels, etc. are up-to-date, active, and visually appealing to make a strong impression on potential investors during their background research. Keep in mind that investors are likely investing to help you grow, so don't overly focus on the number of followers.
Not your first round? Update your existing investors
Retaining existing investors is much easier and more cost-effective than acquiring new ones. Your existing investors already know you, have bought into your idea, and are keeping a close eye on your progress. To secure the first 25% of a round (which can be the most challenging part), leverage your most responsive audience. Start early, focus on your progress, and tie everything to how you've increased the value of their investment. If you've missed some targets, be honest and open about what you'll do to return to that level.
Set yourself up to take on investment
Speed is key, so make sure you are set up to take investment as soon as the investor is ready. For most businesses, SeedLegals is all you’re likely to need - a quick, easy, and cost-effective way to manage the legal side of raising investment and managing your business.
Another important step to consider is to keep the investment in a separate bank account. It will ideally need to be unspent for platforms to agree to reflect it as the cornerstone. However, if you do need to spend some of it, it’s worth speaking to a platform campaign manager to discuss your options.
Raising funds for your business is both a challenging and rewarding experience. But if you follow the steps above, you’ll be able to attract investment more easily and effectively. Remember, the key to success is preparation, research, and persistence.
Good luck!