Tips To Successfully Secure Your Funding Round
Securing funding for your enterprise is one of the most important objectives for ensuring your success. That’s true for startups as well as established businesses. Everyone needs additional capital from time to time and knowing how to bring investors over to your side is an essential skill.
If you’ve spent any time watching “Shark Tank,” you might think you need to be flashy or quirky to get the attention of investors. However, the truth of the matter is that in real life, there’s no substitute for an honest, straightforward value proposition. Investors by and large want to know you’ve put in the effort to plot out every conceivable detail, and most of them can spot a long-shot pitch a mile away. If you want to secure your funding round, you’re going to need to be able to deliver the goods.
Building Your Pitch
Winning your capital begins with choosing the right investors to target. Just because someone has the money to invest doesn’t necessarily mean you should approach that person. Having a solid lead backer means others will be more inclined to follow suit, because a savvy investor instills confidence that you’re a safe bet.
When it comes time to make your pitch, you need to begin with what you think makes it appealing. You should figure out what makes your idea unique and how your team and plan are poised to make the most of it. From there, cut right to the chase. Being clear and concise about your target market, solution and competitiveness is critical. Trying to appeal to emotion might make for a good story, but investors will be focused on the bottom line.
To that end, you need to have strong financial forecasts as part of your presentation. Do your research and make sure your projections demonstrate an understanding of the industry. On top of this, you must be able to give an accurate timeline showing when you expect revenue to make the venture profitable. This level of forecasting is far more important to the majority of investors than a novel idea or some type of gimmick.
Finally, you need to show that you can build the team that is necessary to execute all your ideas to their fullest potential. Once the capital is in your hands, who will be on the front lines in charge of bringing your plan to fruition?
It’s impossible to do much of anything in the world of business without the right funding, and that means being able to pitch is crucial. For more ideas on funding your next round, take a look at the accompanying resource.
Infographic created by Donnelley Financial Solutions, an SEC reporting software company