Businesses at all different stages find themselves in need of investors, but many struggle to find them. This is especially true of businesses that limit their search to US funding sources. However, if your company is ready to expand overseas,financial translationservices can help you tap into the foreign capital, talent, and technology that could secure your success.
In addition, this relatively untapped market for funding is on the rise. According to the US Commerce Department,foreign direct investmentin US companies reached a record $348 billion in 2015. The rapid expansion of emerging economies around the globe suggests that this upward trend is likely to continue.
So what is a solid strategy for reaching foreign investors who speak different languages, have different cultural backgrounds, and who may even have different business philosophies?
As every business leader who has tried to raise funds knows well, reaching investors is difficult. When it comes to approaching foreign investors, there are several strategies that fund managers have used successfully to tap into this unique market. Let’s discuss 3 of the most promising business strategies.
1. Start by approaching local banks in your target market.
Local banks in all countries have tight connections with major asset holders in the region. Any business searching for international investors must establish relationships with bank account managers and persuade them that the bank will also benefit from the investment deal.
Because many foreign markets have underdeveloped financial services and these services tend to be supplied by local banks, foreign investors are often actively in touch with bankers. Thus, the local banks gain access to investors with the highest net worth.These financial ties make bankers the perfect liaison for selling your business as a wise investment or making key introductions.
Of course, in the banker’s mind, dollars invested in your product or service means dollars not being deposited at the bank. This is why it’s important for you to convince the banks that dollars invested in your company will return to them.
One suggestion here:focus on countries with low or even negative interest rates, like Japan, Switzerland, Sweden, Denmark, and Israel because they are often easier to sell on foreign investment deals.
2. Create an investor pitch or seminar in their language.
Once you begin building trust with local banks and businesses in your target market, it’s time to turn your attention to the pitch itself. Investment deals most often fall apart at this stage. So remember thatall the best local connections with banks and investors cannot make up for a poor, insensitive, or confused investment pitch.
How do you create a winning investor pitch for foreign investors? First, prepare your pitch presentation both in English and inyour target investors’ local language. Here is where your financial translation services provider will truly earn their keep. Make certain that you scrutinize the local translation more than the polished English one. It’s important to hire separate editors and translators to recheck each other’s work.
Next, consider cultural nuances and what gaps in understanding might arise as a result of these differences. Make sure your financial translation services can fill these gaps. For example, a business model for a restaurant that depends on compensating wait staff using gratuities makes good sense in the US, but in Budapest, where tipping is not standard, this may need additional explanation.
Finally, ask your financial translation services provider to check examples and analogies carefully. Use analogies that local investors will understand to describe your business and the investment opportunity.Rather than thinking about your products, think in terms of the underlying principles involved.
3. Form alliances with partners in foreign economies.
Another successful approach to finding foreign investors is to make sure to form the right alliances and strategic partnerships.You will need partners both in your home country and in each of your target markets.
Non-governmental organizations (NGOs), business associations, and industry groups often provide access to international investors through their networks. Since investors in foreign nations tend to be business leaders, they will be more likely to work with other business leaders. Working through these types of organizations as allies will lend credibility to your cause and help you build trust.
If you are targeting investors in emerging economies, NGOs are the partners you need. A national NGO advocating to improve infrastructure in Nigeria, for instance, may turn to investors in Great Britain or France who may be open to investing in your business.
As you’re investigating which investors to pitch, look for long-standing NGOs with a history in that country. They will be able to point you in the direction of the big players in each industry.
Where to find investors
After determining which business strategy is best for approaching potential investors, you’re ready to make a plan for identifying them as efficiently as possible. Research here can eat up a lot of time if you’re not careful. However, there are a few ways to narrow your search quickly.
- Explore multinational companies:One way to tap into the foreign investor pool is to approach existing foreign or multinational companies to form joint ventures, subsidiaries, or other strategic alliances. Research will involve finding the right contact person. Also, make certain the business plan you present to foreign stakeholders discusses budgeting decisions adjusted for political and economic risk; cross-border cash flow; and transactional cost reduction.
- Participate strategically in relevant trade shows and conferences:Investors on the lookout for the next big moneymaker will be making the rounds at major international trade shows and industry-specific conferences. Instead of throwing ideas against the wall to see what sticks, why not consolidate and go where the prospects are? Look for centralized gatherings of your target investors.
- Comb investor databases related to your industry:Keep in mind that foreign investors come in all different forms from private equity to venture capitalists to angel investors. Fortunately there are several investor databases (e.g., VCGate, Gust.com, and DubaiBeat.com) that will help you narrow down and keep track of which investors are appropriate for your company.
As you embark on this next important phase in your business’s growth, remember that you aren’t just looking for deep pockets. You’re looking for a lasting partner who can help you find strong connections that will allow you to grow your business.
Forming these lasting partnerships requires having the right financial translation services support. LetAlpha Omega Translationsguide you through the process with language translation services that will represent your company accurately, clearly, and persuasively. Contact us torequest your free quotetoday!
Category:Translation Services
