All ideas for new businesses have one key thing in common—they require startup funds before they can launch. Ask most any founder and he or she will tell you that finding and securing startup funds to take their business idea from concept to reality is a major challenge. Several surveys have validated this as a top-of-mind concern among founders.Some businesses need more startup funds than others. But how can you make your company more attractive to investors? Here are ten proven tips for securing startup funds by making your company more attractive to investors:
- Is your business disrupting the industry? Think of it this way—Amazon. Amazon has been disrupting the brick-and-mortar industry since its inception. First it was books. Then they jumped into, well, everything. If your business is as disruptive as Amazon, then investors will look at you like you’re made of gold.
- Your management team should go above and beyond. Investors always salivate when looking at a great management team. If you have an exceptional team behind you, then your credibility will skyrocket. Investors universally agree that a top-notch team is critical to securing startup funds. A great team can make a mediocre idea a huge success but a lousy team can make even the most groundbreaking idea a disaster. A 2017 Forbes survey showed that having a poor leadership team is one of the most common reasons new startups fail.
- Show investors you’re not afraid to grow. Before providing startup funds, investors need to know that founders are not afraid to learn and grow. If you’re courageous about growth then investors will feel that you are moving forward with innovation rather than stagnating in stability. Founders with a policy to accelerate growth are very attractive for investors.
- Fewer company debts is a great sign. The fewer your loans and debts are, the better your chance to land that investor money. Remember, it’s always about the cash flow. The better you are handling your accounting and financials, all the better for the company.
- Know your enemies. Well, hopefully you have no enemies. Let’s just say competition instead. Know your competition. They will be as full on with seeking funding as you are. Know their strategies and learn to be better than them, or at least co-exist with them. It’s not a no-win scenario if you have competition. Competition is a great driver of innovation.
- Be the frontrunner in your industry. This is easier if you started the industry like Netflix for example. But if not, do your best to be one of the influencer in your niche. Take advantage of the press and be a resource person for them. Differentiate yourself in your market by being the best at one or two aspects of your business. For example, you can have the best customer service with only local employees. This will make startup funding your company easier.
- Use the Internet as a home. Be available to investors by having a quality, well-designed homepage on the Internet. You can even make your homepage from Squarespace or WordPress, whichever is easier for you. These services offer an easy, fast way to build a professional looking Internet presence at a low cost. The important thing is to have your contact information accurate and updated. Write the best about page you can. Narrow down your focus by explaining your unique selling proposition.
- If you can’t be the expert, find experts. As a founder you can’t know everything in your field. But you need to surround yourself with experts in your field. Experts that you can trust to explain to you in plain English how things work. This way your credibility will rise and their expertise could rub off on you.
- Problem solve your way to success. You already know what your product or service has to offer. In order to be more effective, you should define the problem you are solving. If you can’t define the problem, you might run into a market you can’t serve.
- Focus on cashflow and benefits. As the founder, you might get into the nitty-gritty of your technology. It’s a trap. You need to focus on your strengths and that is running your business. If you want to focus on technology then hire a CEO to run the business side of things.
If you are a founder seeking startup funds to take your business idea from concept to reality, following these ten key tips can give you a leg up in your quest. Contact me today if you want to learn more about successful strategies to secure startup funds.