Publication number: ELQ-79878-1
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How to Overcome The Investor Challenge For Your New Venture
7 Keys To The Investor Challenge For Your New Venture
Introduction
According to the entrepreneurs I advise, the biggest challenge they typically face in starting a new business is funding. It consistently takes a huge amount of time and effort to find an investor you can trust, and that constrains your efforts in developing the solution you envision. People always expect that it should be easy to find investors, given their passion and excitement for the solution.
Yet according to recent data compiled by Fundable, 57 percent of successful entrepreneurs end up funding their startup, and that’s a good thing. If you want to run your own show, and not hand off a large chunk of future financial gains before you start, the only approach is to dip into your own resources, or even work for someone else a while and save until you are ready to break out on your own.
According to the same sources, another 38 percent get support from family and friends, so that leaves only five percent who rely on crowdfunding, banks, angels, or VCs. The hard work begins then, in finding a match for your domain and solution readiness stage, as well as an investor that matches your vision, values, and needs. Here are the steps I recommend to optimize your efforts:
- Step n°1 |
Prepare a killer pitch and backup materials prior to investors.
Many entrepreneurs I know approach investors before they have a pitch. You only get one chance to make a great first impression, so you need ready answers to key financial and business issues. Do your homework on opportunity, competitors, financial projections, funding required, and hook investors the first time you can with an executive summary and ten-slide pitch.
- Step n°2 |
Request warm investor meetings from peers and advisors.
The old cold call or broadcast email to anyone who has “investor” in their bio just doesn’t work. In my experience, an introduction from a mutual friend or business associate will double or triple your odds of closing a deal. In fact, advisors and peers are the ideal investor.
