How to Securing Investors for Small Business?

Maybe you’ve been thinking about it for a while, but aren’t sure where to begin. You are a small business and you want to bring an angel investor on board to give your company a financial boost. Or maybe you’re in the planning stages and need financial help to launch the business. There’s a lot of competition out there to make your business stand out, and to get that all important seal of approval from a potential investor. How do you best present yourself and your business?

These considerations are different for existing companies as opposed to start-ups, and I’ve found some clear dos and don’ts which I feel every business should bear in mind. In this article, I am going to discuss only the important points for existing companies, and will cover the details for start-ups in a separate article.

Understanding the Market

Your business plan should outline potential growth and demonstrate – feasibly – where you hope for your business to be one, two or five years down the road and beyond. It is important that a company understands the potential, as well as limitations, of its product or service. What is the size of your addressable (not total) market?

Product

If you produce something that is unique or fills a niche in the market, I want to know more about it. Why? Because it has the potential to be something people will want to buy. You have to have a great product or service – there are simply no two ways about it. Quality is also important – there is no point cutting corners; there is so much competition on the market, customers are simply not going to give you the time of day.

Selling

What does it take to sell your product? How long does it take? What are the channels? Who do you need to get on your side? Depending on the nature of the product, consumer receptivity to messages aimed at altering their beliefs will tend to vary a great deal.  For important products, products that are expensive, high quality argument is required to persuade the customer; the customer is likely to scrutinize the argument and come up with questions. However, for products that are not so important such as soft drinks, research suggests that consumers are often persuaded by having a large number of arguments with little merit presented.

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Ask around to see who else has done business with a customer, and what results were achieved. Tell the customers about yourself, your history, the service/product that you offer. Understand why you set up your business and how you run it, to be clear in your goals, because your goals reflect in the way you work and the way you work, forms an image of your company in the market. The more personable and clear you are with a client or a customer, the more chance you have of a great working relationship with an investor who will believe in your business – and in you.

Accounts

This one is a no-brainer, but you should have your books worked out. Obviously, a well-run company is more lucrative than one that has a history of debt, bad money transactions or a weak financial position – no amount of cash injections can help in that case. You’ll need to show your turnover, profit margins and potential growth. Show your expenditures, what areas are costing what and how efficiently your company is handled.

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Can the market sustain you in the long run, or is there a risk that, after an initial growth phase, you might lose out to other, newer businesses or products? If you can show that you understand the competitive landscape and your unique selling point, then the investors will know that you have a clear understanding of your position in the market. An investor wants to know that their contribution is sustainable with a sound return.

Did you know that people are 80% more likely to remember about your product or service if they watched a video? HyperEffects provides you with extravagant and enticing videos that will attract your potential clients and retain your current ones. Their custom-made videos offer state-of-the-art production and unique perspective, to give you the status you deserve. And remember, do not give up easily. 80% of B2B sales are conducted after the 5th encounter!

Do keep coming back for more information on the subject. Please leave your comments in the message section.

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