Finding an investor who will agree to invest their money in a project will take a lot of time. You need to look for new business contacts and talk to interested people at the stage of developing a business plan. This will significantly reduce the time costs and simple idea. You should also understand that many investors need time to assess the real development prospects of a particular company. And when interacting with banks or investment funds, the time to analyze all aspects of the potential client's business activity will be quite large.
Collecting maximum information can help in two directions at once: filtering out candidates and conducting better negotiations. For the first, you will need to know: What areas the investor is interested in; Where he usually invests money; In what volumes; What profit is he expecting. It is important to understand that you should not approach a person who usually invests millions in a project for a small sum of money. He will simply not be interested in your offer. For negotiations, you may need everything you can find out about a potential investor. After all, in essence, this will be a process of selling some share in the business (to one degree or another). And for sales, it is always important to find the client's pain points and press them, pushing them to the fact that it is you and the investment in your business that can allow him to solve all his problems.
You need to name a specific amount that you will need from a potential investor. You cannot use ranges, only in extreme cases when you are not sure about the stability of the price over a certain period of time. You also need to understand that you should not ask for more or less money. This will characterize you as a person who has not thought through their business plan enough.
It is hard to imagine that Henry Ford was afraid to tell others about his ideas. On the contrary, he openly stated that he would create a device that he could sit in and drive down the street without additional traction. You should do the same with your business ideas in negotiations. Boldly state your ideas, even if someone thinks that they are far from ideal and difficult to implement. Remember about presentation! The more confidently you speak, the better you are perceived.
All promising projects started in the head of one person. But it is difficult to implement all the ideas alone, and this is a generally recognized fact. It is best for aspiring businessmen to find a team of 3-5 people who would initially deal with various company matters, solving each of their own issues and becoming professionals in their field. It is important to build a team of like-minded people who will be passionate about one common idea and spend all their energy on implementation. Those who slack off have no place in such a team.
Speak to the investor in his language. Promise him profit, then operate with prospects for growth and expansion. You should carefully think about the question “What will make my project good?” at the business planning stage. Having answered it for yourself, ask the same question, but from the investor’s point of view.
Attend various meetings of potential investors – business forums, conferences, and other events of national scale. At one such conference you can talk to a hundred different people who will be interested in investing in your business to one degree or another. A small psychological trick: do not say that you came looking for investments. Try to look like one of the investors – a person with money. Then you can be one of everyone and they will start to treat you with more trust and sympathy.
When looking for a potential investor, you need to understand that you will be mutually beneficial partners. That is why you should always provide the most complete and honest information about the company's affairs, its prospects and your plans. Most often, it is better to hear a real "I would like to sell the company in a year for several million dollars" than "I will focus on fulfilling the company's tasks and expanding it, and reaching the global level." In the first case, honesty and transparency, in the second, nothing but floridity and evasion. Following these tips is quite simple, but their observance will help you gain an advantage in negotiations, over other similar seekers of free finance and interested investors.
Many people still prefer to invest their money in low-income and illiquid real estate, rather than buy shares of some young and developing company. But investors are of colossal importance for business development within the country.
Investors can be both individuals with sufficient capital and companies interested in making a profit. In order to interest an investor, you should always talk about money and income. Only after that should the prospects of the idea, risks and other factors come into play. Drawing up a competent business plan and planning negotiations will tip the scales in your favor with 80% probability. That is why you should not only understand your own idea, but also be able to present yourself competently.
