Use Every Avenue Available
Using all your available resources might sound obvious, but people don’t take advantage of every avenue they have. Contact family members, reach out to your college professors, or use social media and online business network platforms. Strike up conversations with people in the gym or in line at Starbucks. If you’re looking for investors, you should focus on little else and seize every opportunity available.
Investor Network
Finding The Investors
It’s scary putting yourself out there to potential investors, but that assumes that you can find them first. It’s frustrating starting from scratch to look for investors, unless, of course, you know where to look.
Start With A Launch Platform
The internet has provided a lot of different resources to reach investors. Research different relevant launch platforms or crowdfunding sites to get your business or product off the ground. While this method isn’t traditional networking, it puts you in place to get the start-up cash you need.
If you have success with the launch platform, then you have capital in your pocket to buy you time to seek bigger investors. It’s difficult for investors to be the first one to jump in. If you have a solid foundation when you approach your investors, they feel like there is less risk because you already have others who have legitimized your idea.
Network Through Friends And Family
A lot of people are hesitant to mix money and family, and for a good reason. That doesn’t mean you shouldn’t use your friends and relatives’ contacts to network with investors. Although you might not want to get involved with a family member as an investor, you could discover that a friend of a friend invests in startups or is looking for a business venture to get involved in.
When approaching friends and family members, avoid the hard sell. Let them know about your idea and what you’re trying to do. They might offer their contacts up on their own if they like the idea. You could also type out an email and send it to your contact list explaining the investment opportunity. A friendly note asking your contacts to pass along the email to anyone who might be interested could put you in touch with just the right person for an investment opportunity.
Join Online Business Networks
Websites like LinkedIn were designed for people who want to network with others in their field. Don’t be afraid to use LinkedIn and other online business networks to reach out to potential investors. When you have mutual acquaintances, you are somewhat legitimized to the person you contact. You can also check out your contacts to see if they know anyone in the field who could be a potential investor and have them make the introduction.
Utilize Your Social Networks
Social media isn’t just about pictures of vacations, pets, and babies. It’s second nature now to log into Facebook and see an advertisem*nt for a product, or a friend who is selling Rodan and Fields or Herbalife. Don’t be afraid to use your social media account to search for investors. It’s likely one of the biggest networks you have.
You can start by posting on your page about the potential opportunity and ask anyone who might be interested to send you a private message. Once your product or business is past the first phase, you can start a business page and network for investors through that as well. People who aren’t interested can easily ignore it, and individuals who are can reach out to you. Potential investors might also stumble upon your page on their own.
Attend Relevant Conferences
You’re more likely to find an investor for your business or product if you surround yourself with people in the same arena. Sign up for conferences that are either for small businesses looking for investors or in the field of your business. Take advantage of every opportunity to network during the conference. Make sure you stay in the recommended hotel instead of saving money with a different one.
The more opportunities you have to network the better. Head to the hotel bar, watch for people wearing conference swag at the airport, and attend every meet and greet available through the conference. People are attending these conferences because they are part of that field so make sure you’re well-versed and ready to strike up a conversation with anyone.
Follow Potential Investors Blogs
Find people in your field and follow their blogs. Many potential investors follow the comments closely on their blogs, and you can start a dialogue just by commenting or engaging with the author. Don’t mistake engagement by spamming every potential investor blog with your information. You need to create real conversations in the comments to meet other like-minded people or catch the attention of your blogger and potential investor.
Reach out to those who own the blogs and offer to write a guest blog to highlight your idea or opportunity. You need to find the right blend of marketing and information so that it’s something a blogger will find useful for their site. Make sure you link back to your website, or at the very least include the contact information. Once your guest blog is posted, make sure you follow-up and respond to comments on your blog as well.
Meeting With Investors
Once you’ve set up a meeting with an investor, the hard part isn’t over. Part of networking with investors isn’t just finding them, but figuring out how to attain credibility and foster relationships.
Don’t See Dollar Signs
You know you’re looking for money, and they likely know you’re looking for money, but if all you see is dollar signs, you probably won’t get far. Investors are looking for an opportunity; they aren’t just seeking to spend their hard-earned money. You can’t rush into talking about dollars or you’re likely to turn off potential investors.
Treat your investors like humans. If you have a meeting set, let them set the tone and direction of the conversation. If you’re at dinner and they don’t bring up your business or product until dessert, then don’t act anxious to get to your pitch. These investors are likely going to be part of your business for a while, so you need to treat them as people early on to garner an ongoing relationship.
Conversely, stay the course with your investors. Don’t let an entire dinner go by without taking the time to talk about your product. Don’t pass up an opportunity to make your pitch. You don’t want to be pushy, but you definitely don’t want to miss your opportunity as well.
Do Your Homework
If you get the chance to talk one on one with an investor, make sure you’re ready. From the second you decide to look for investors, have your elevator pitch ready. An elevator pitch is a 30-second pitch to investors for when you need to get someone’s attention quickly.
If you get the chance for a sit-down meeting, have answers ready for any potential question they might ask. Have tangible evidence of your numbers and other critical information they might want. Make a brochure if it’s relevant so your investor can keep it to look over after the meeting. When you’re asking for a lot of money, preparation is crucial.
Network Through Potential Investors
Unless you’re incredibly lucky, you’re not going to score big with the first investor you meet. Don’t be afraid to network through investor meetings. If your meeting doesn’t go well, or if your product or service just isn’t right for that investor, don’t be afraid to ask for names of other potential investors. If you feel like that’s too bold, then ask the person or business to pass along your information to other potential investors. A simple polite request can go along way.
Networking can be hard work and stressful. If you’re not a natural conversationalist or salesperson, you might want to bring on a team member to help with the networking. Make sure everyone involved in your company knows you’re searching for investors and reaches out to people they know. Get in the mindset that everything is a potential opportunity, and never let that opportunity pass.
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