Thu 20 Jul 2017 11:07

Do's and Don'ts in Talking to Investors

You've got a product or a service, your own project, which you decided to position as a startup. Before making such a decision, you need to choose a way for the development of your project.

Is it really a startup, or have you actually started a small business project, but do not understand the difference? 

First, read our article - Is your business a startup? - to decide.

So, you are the owner and the founder of the startup. And now you are in an active search for an investor who wants to invest his big money in your project and turn it into something outstanding and famous. Or just to something popular and bringing an excellent income. You have already found several potential investors and now you are going to talk to them. And here begins the most difficult - your search may not succeed if you make certain (and very common) mistakes. And the chances of success increase if you negotiate correctly. So, what do you need to know?

Find exactly who you need ...

... and who needs your startup project. One of the most common mistakes of beginning startup owners is to talk to everyone in a row and spend their time on people who do not have an interest in their product. Moreover, it is not possible to develop this interest. Examine the question - determine whom exactly do you need, whether it is an independent investor and owner of impressive capital, or an investor company, or a special fund ready to invest in your startup project. And when you understand who it is about, start actively looking for these people's contacts.  Find a way to communicate with someone who is likely to get interested in your project so much to invest in it his financial resources. It's pointless to talk with those who do not concern your working niche and do not plan to work with it.

What are Your Startup Must-have Tools?

Do not try to deceive them

Do not take investors as potential rivals and play with them in unfair games. If you are going to convince them bypassing the quality and reliability of your project, to get them to pay a round sum of money for it, this method can't be attributed to honest. Do not think that your investors are stupid and naive people. No one gives their money simply. They also study the question and know how to choose the right startup for investments. Do not hide the errors and shortcomings of the product, it will still pop up one day - and no one else will trust you. Speak bluntly: every product has problems, the investor also knows this. The question is that he agreed to work with the drawbacks that your product or service has, and you tried to do your best to fix these problems.

What You Should Know Before Running a Startup  

Always have an investment plan

The investor will not part with his money just like that - because you have a good product and a great idea. He needs to know exactly how you are going to use his financial investments. Always be prepared for the conversation, you should have a product development plan, but not only. You should have a plan of how you are going to spend your investment. On what part of the development or creation of the product a specific part of this money will go, what can it bring to you and the investor in the future, what changes are expected in case of successful development of the product or its failure, at which point it may be necessary to add additional funds, and so on.

Why Startups Fail: The Most Common Mistakes

Adequately predict growth and development

You shouldn't overestimate yourself, your company and your product. But underestimating badly affects your chances of getting a good investment, too. Try to look at things adequately - as closely as possible to how things are in fact. Such characteristics as the ideal, absolutely unique, unparalleled, without competition in the world sound excellent, but will the investor believe in them? It is best to tell the truth and be specific - if unique, then in which features and functions, if there is no competition, then which companies and products are most similar to it or have similar options. Do not base the growth prognosis of your product or company on the basis of similar examples - there are no identical business situations, and if a competitor has a rapid growth in profits, it does not mean that your rates will be the same. And vice versa, if it failed, it absolutely does not say anything about your prospects. You can succeed!

5 Best Tips for New Entrepreneurs

Give all the information

Your potential investors should get all the most detailed information about your product at the first opportunity - as soon as they ask (or if they don't, offer it to them by yourself!). Be ready to present your product, service or company with high quality - provide yourself with a well-done professional presentation, print handouts, create several high-quality videos. Before a person - and this is ALWAYS a person - will invest in your project, he should be able to view it from all sides, see all the advantages and disadvantages very clear, and only then make a decision. Give him this opportunity and demonstrate everything you can. Answer always, contact at the first request, send everything they need. You not only provide the interest, but also earn the respect.

And be persistent. Remember that if 99 out of 100 people answered "no", and one said "yes", it may the person who will invest a million in your business. Be kind and correct with everyone, show yourself and your product from the best sides - and you will succeed. Good luck!

© Assiomatica SA

Do's and Don'ts in Talking to Investors

Do's and Don'ts in Talking to Investors

Posted on 2017-Jul-20

Is it really a startup, or have you actually started a small business project, but do not understand the difference? 

First, read our article - Is your business a startup? - to decide.

So, you are the owner and the founder of the startup. And now you are in an active search for an investor who wants to invest his big money in your project and turn it into something outstanding and famous. Or just to something popular and bringing an excellent income. You have already found several potential investors and now you are going to talk to them. And here begins the most difficult - your search may not succeed if you make certain (and very common) mistakes. And the chances of success increase if you negotiate correctly. So, what do you need to know?

Find exactly who you need ...

... and who needs your startup project. One of the most common mistakes of beginning startup owners is to talk to everyone in a row and spend their time on people who do not have an interest in their product. Moreover, it is not possible to develop this interest. Examine the question - determine whom exactly do you need, whether it is an independent investor and owner of impressive capital, or an investor company, or a special fund ready to invest in your startup project. And when you understand who it is about, start actively looking for these people's contacts.  Find a way to communicate with someone who is likely to get interested in your project so much to invest in it his financial resources. It's pointless to talk with those who do not concern your working niche and do not plan to work with it.

What are Your Startup Must-have Tools?

Do not try to deceive them

Do not take investors as potential rivals and play with them in unfair games. If you are going to convince them bypassing the quality and reliability of your project, to get them to pay a round sum of money for it, this method can't be attributed to honest. Do not think that your investors are stupid and naive people. No one gives their money simply. They also study the question and know how to choose the right startup for investments. Do not hide the errors and shortcomings of the product, it will still pop up one day - and no one else will trust you. Speak bluntly: every product has problems, the investor also knows this. The question is that he agreed to work with the drawbacks that your product or service has, and you tried to do your best to fix these problems.

What You Should Know Before Running a Startup  

Always have an investment plan

The investor will not part with his money just like that - because you have a good product and a great idea. He needs to know exactly how you are going to use his financial investments. Always be prepared for the conversation, you should have a product development plan, but not only. You should have a plan of how you are going to spend your investment. On what part of the development or creation of the product a specific part of this money will go, what can it bring to you and the investor in the future, what changes are expected in case of successful development of the product or its failure, at which point it may be necessary to add additional funds, and so on.

Why Startups Fail: The Most Common Mistakes

Adequately predict growth and development

You shouldn't overestimate yourself, your company and your product. But underestimating badly affects your chances of getting a good investment, too. Try to look at things adequately - as closely as possible to how things are in fact. Such characteristics as the ideal, absolutely unique, unparalleled, without competition in the world sound excellent, but will the investor believe in them? It is best to tell the truth and be specific - if unique, then in which features and functions, if there is no competition, then which companies and products are most similar to it or have similar options. Do not base the growth prognosis of your product or company on the basis of similar examples - there are no identical business situations, and if a competitor has a rapid growth in profits, it does not mean that your rates will be the same. And vice versa, if it failed, it absolutely does not say anything about your prospects. You can succeed!

5 Best Tips for New Entrepreneurs

Give all the information

Your potential investors should get all the most detailed information about your product at the first opportunity - as soon as they ask (or if they don't, offer it to them by yourself!). Be ready to present your product, service or company with high quality - provide yourself with a well-done professional presentation, print handouts, create several high-quality videos. Before a person - and this is ALWAYS a person - will invest in your project, he should be able to view it from all sides, see all the advantages and disadvantages very clear, and only then make a decision. Give him this opportunity and demonstrate everything you can. Answer always, contact at the first request, send everything they need. You not only provide the interest, but also earn the respect.

And be persistent. Remember that if 99 out of 100 people answered "no", and one said "yes", it may the person who will invest a million in your business. Be kind and correct with everyone, show yourself and your product from the best sides - and you will succeed. Good luck!

© Assiomatica SA