IanCongratulations, you have finally decided to put into practice, your business idea. THAT is the big step. What next? How and where from, do you fund your dream? The ground work that you have diligently worked on can soar high only if it has wings of currency.
Every successful entrepreneur will tell you that getting people interested in your idea is very different from raising capital using that interest. It’s a thin line between gaining interest and selling your idea. How do you achieve success here? Here’s how: Before you pitch the idea, prepare a thorough model- one that details your business idea, marketing plans, sales predictions, expected expenses and revenues, growth, scalability etc. Identify customers. And most important of these is your financial model. Present your plans accurately. Tell a compelling story that charms people, to go along with your Excel and PowerPoint files. Get the models checked by peers and experts. Above all, anticipate and prepare answers for every possible question. Play your own devil’s advocate. That’s your passport to raising seed money.
Be ready to pitch the idea to a lot of people. Do not write off people. You never know who you will meet through whom. You MIGHT interest a few people. There MIGHT be a few interested people ready to expend their time on your story. Even fewer MIGHT actually be interested in funding your idea. So, reach as many potential investors as possible. This is where your networking skills play a huge part. Get in touch with the right people who can put you in touch with the right people.
Think BIG. Give potential investors the life size picture. Tell them of where you see the idea in the next ten years. When you pitch, make sure you make them see long term. Seldom do you find successful entrepreneurs who are embarrassed to ask. Ask. Also, never give up easily. Requesting for capital does not mean that you are stooping low. Think of it this way- you are providing others with an honest opportunity. This would also ascertain a sense of accountability from your end.
When you meet potential investors, show them where you NEED capital. Show them how every penny is going to be utilized. Have accurate figures. When someone asks you how much of capital you are looking for, don’t quote a figure off the cuff. It is quite tempting, especially when you are a first timer, to jump at any offer that comes by. But get the right people to fund you. Are you willing to let someone else call the shots because they have invested in your idea?
Look at the feasibility of merger options. Thus your competitor becomes your investor. This also takes care of teething problems that start-ups face.Crowdsourcing is the new age way of raising capital. The social media has created a wonderful platform to aid crowdsourcing. Instead of looking at one or two investors, you are throwing open the doors of investment and opportunity to a lot of people.
