How to successfully get the first round of funding for your business

How to successfully get the first round of funding for your business

One of the main reasons a business fails is because it runs out of money too quick.  It's definitely an uphill battle when you decide to get into business for yourself, but it's not impossible.  If you plan to get huge, you will likely need to learn how to attract investors and also how to get them to invest.  Learning how to obtain funding is a skill of it's own, and you need to figure out how to do it.

In this discussion I'll go over how to successfully get the first round of funding for your business.


1. Research who you're going to be talking with
Almost all of the time an entrepreneur will forget to research the firms or people they are contacting for an investment.  Not researching who you're contacting just shows how unprepared you're going to be for your own business, and this means you will get shunned by most (or all) of the people and firms you contact.  If you're not familiar with what the firm or people do with their money, it instantly throws up a red flag for the investor and they will likely discontinue the conversation.

You need to know what the firm, or person, is interested in because that's what they invest in.  If you pitch someone an app idea and they invest in software, you're likely going to get ignored.  If you just sit down and do  a day or two of research, you will leave a better impression with the investor and have a better chance of getting the funds you need to become even more successful.


2. Figure out how to get a warm introduction
Almost all of the investment firms won't even look your way if you don't have a warm introduction or are on their radar.  If you don't know how to get a warm introduction with an investment firm, you can always hire a lawyer to do it for you.  Hiring a lawyer is one of the quickest ways to do this because they usually know someone at the investment firm within their area.

I would avoid at all costs just emailing them every day to get on their radar.  It makes you look annoying and they will eventually just block your emails.


3. Avoid the pitch, just talk normal
When you're talking to an investor, they don't really want to hear a pitch from you.  If they want to set up a meeting with you, they already know 90% of what's going on with your business.  They just want to meet up with you in person and see who you actually are and have you answer a few questions.  Investors likely have been sitting around all day hearing one pitch after another, don't you think it would be nice if they could just talk to a normal human being for a few minutes?  You would likely stand out from the crowd if you treated them like a person and not a stack of cash you're trying to obtain lol.  You'll need to build up your relationships with the investors since you likely won't get your funding on the first, second, or even third meeting.


4. Talk and have a competitive edge
Even if you are the best at what you do and your product is amazing, no one will know unless you're talking about it.  If you're the owner, you need to be the one at the front of the lines spreading the word about your amazing product or system.  If you can't talk about your product, no one will.

You will also need a competitive edge when it comes to enticing investors into opening their checkbooks.  If you're just pitching some random company that 5,000 other people have already tried, you're going to be ignored.  You need to have something that others do not, like proprietary technology, being more connected than everyone in your industry or just being the first one with the idea that is going to market.  If you have something that many others do as well, you're system can easily be replicated and that's a threat to investors.


5. Have a great story
One of the most important things you can have, is a story about your journey and product.  This will show the potential investors what you've battled through to get to the point you're at now, and that you don't intend on stopping for anything.  An investor wants to see that you're a fighter and you won't stop until your product, service or system is the best out there today.  If you can get investors to be in your cheering section, they will likely invest in you



In Conclusion:
Getting on an investors radar isn't as easy as it sounds, but it's not impossible.  Hire a lawyer that works with the investment firms and you can get connected.  Don't pitch because the firms hear them all day, just be a human being talking about what you want to do.  If you can master all of what was mentioned above, you will likely get some investors in the next 12 months


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Thanks!

Razzy