It doesn’t matter what kind of business you’re starting. You could be starting up a firm that helps hospitals with physician recruiting. You could be opening an independent bicycle manufacturing company. When you’re initially starting up your company, any investment can feel like a welcome investment. The reality is that not all money is created equal. There are investors you want to attract and others you don’t.
Here is how you make sure you attract the investors whose attention (and money) you want the most.
1. Communication Is Key
You’ve heard of the 24-hour rule when it comes to professional communication, right? When it comes to attracting investors, it’s best to implement a 12-hour rule. This shows potential investors that you genuinely care about them and are committed to keeping them happy and in the loop.
2. Always Be Honest
It is better to be honest than to try to gloss over details that are less than flattering. All it takes to completely tank your start-up before it gets off the ground is the discovery of deception. Even a teensy tiny white lie, when uncovered, can derail your business—potentially permanently.
Investors want to work with professionals who are known for going the extra mile and putting in extra time and effort. Be those professionals. A good way to help ensure success is to under-promise results. Whatever you think is a reasonable expectation, reduce your promise by at least 25%. That way, even if you only meet your own expectations, you’ll still be doing more than you promised your investors.
Note: This also gives you some wiggle room if you run into problems while tackling a project or problem.
4. Always Put Your Best Face Forward
Every person you meet—even the one behind you in line when you go to the grocery store at 3 AM for cough syrup—is a potential business partner. It is important to be friendly, polite, and as put together as possible at all times. It helps establish you as a trustworthy professional within your community and increases your chances of making meaningful connections (even when they happen on the fly).
5. Offer Proof
If you’ve successfully started a business before, tell potential investors about it. Being successful once increases your chances of being able to succeed again. It also shows investors—investors who have undoubtedly started their own companies—that you have what it takes to get a business off the ground.
6. Be Articulate
It’s important that you know how to express your thoughts clearly and eloquently. You need to be able to do this both verbally and in writing. If you aren’t sure of your abilities here, ask for help. Even a basic writing or public speaking class can be incredibly helpful.
7. Do Your Homework
Learn everything you can about every potential investor. This will help you cater your pitch and hold the investor’s interest. Taking the time to learn details about the investor’s professional and even personal life shows the investor that you value him (or her) as a person as well as a potential stack of cash.
8. Prove Your Grasp on Your Market
Show your marketing plan and research to all potential investors. This proves that you understand your market and how to cater your offerings to it, thereby raising your chances for success. Having a cool product isn’t enough. You need to prove that your cool product is wanted by the people to whom you will be attempting to sell it. This is especially true if the business you want to start is highly specialized.
9. It’s Dangerous to Go Alone
Most entrepreneurs want to start their businesses up all by themselves. Getting something up and running without any help becomes a point of pride. Imagine how much further you can go, though, if you accept some help. Putting together a team allows each person to focus on his or her own particular strengths. Fewer mistakes will go un-caught. It certainly doesn’t hurt that teams are seen as more dependable than individuals.
10. Be Yourself
After all of this, it’s easy to think that you need to change yourself fundamentally if you want to attract people to your business. This is absolutely not true! Being true to yourself and allowing your personality to come through helps set you apart from the other cookie-cutter start-ups competing for an investor’s attention. You can be professional and be your best self. It takes practice, but you can do it.
Have you worked with investors before in your business? Share your tips for finding a great investor in the comments below!
Small Biz Club is the premier destination for small business owners and entrepreneurs. To succeed in business, you have to constantly learn about new things, evaluate what you’re doing, and look for ways to improve—that’s what we’re here to help you do.