It’s a thrill for investors to see a struggling business come back to life thanks to an infusion of cash. The thing is, most investors won’t want to invest in a company that they deem to be too risky. In fact, most investors will only give money to companies they know will succeed – or are already succeeding. But regardless of how your business is doing, a solid investment can go a long way.
How do you best present your company to a potential investor? Being concise, succinct, and highlighting the probability of future success is a good start. Here are some tips:
You never know when an opportunity will arise for you to tell a possible investor all about your business. Prepare a 30-second spiel highlighting the strengths and goals of your business. Use it whenever the chance comes about! And remember, this is your chance to help your business shine. Really reel people in right away.
Be clear on your finances. Cash flow, bottom line, sales, revenue… any potential investor will want to know these numbers. You will seem unprepared and ill-suited to be an entrepreneur if you don’t have the answers. It truly is unfortunate that many business owners cannot read and interpret their own financial statements. Lenders will want to know this information, too, so do your math homework.
Usually, if your business isn’t doing as well as you’d like, you’ll need to give your investor a higher stake in the company. The risk they are taking has to be worth it for them, which is understandable. Don’t be too greedy when seeking an investor, and realize the risk they would be taking for you. Remember, you don’t get something for nothing. Investors, if they take on risk, want to see return on their investment.
If you have other investors who’ve already given their money to your company, it’s a good idea to consult with them before you seek other investors. Some people might not like having their money invested in a company that has “too many cooks in the kitchen.” It also shows respect if you talk with your current investors first. Besides, most investors have a lot of experience with small businesses. They can help you figure out whether seeking more investors is the right decision for you.
You have likely spent many years devoted to your business idea, but for an investor, it’s likely the first time he or she has heard about it. Put your best foot forward, and sell the idea! After all, you are your company’s best sales person. Your job is to sell your company to an investor. For more advice on seeking debt or equity financing, connect with the experts at Biz2Credit www.biz2credit.com.