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- 4 Ways to Attract Investors to Your Small Business or Startup - April 13, 2015
Attract Investors to Your Small Business or Startup
When others financially support a small business and its owner, the enterprise can exponentially increase its potential future prosperity and success. So, if you’re an entrepreneur, don’t feel like you are alone on an isolated island. Turn to investors to give your company the financial injection it needs.
Here are 4 strategies on how to attract investors to your current small business or future startup:
1. Focus on selling your abilities and your business plan to others.
Yes, you have to be an adept salesperson to sell your products or services, but you also have to be good at selling yourself as a professional in your industry. When the potential investors out there fully understand your goals and agree with your thinking to a large degree, you’ll have a much better chance of having them stroke you a check to invest in your venture. Two basic strategies you can use to do this are through marketing efforts and professional networking. Get your business idea or formally established enterprise in front of those who might be willing to back it financially. Marketing is perfect for this if you’re already established. Use all the networking methods at your disposal to meet those in your industry – and those who have funding they’re looking to put behind something that could be successful. The art of persuasion is certainly involved here since you have to make a solid case for why investors should put their cash behind your idea. Never forget what their mindset is – how an investment will benefit them.
2. Make your business concept known in your community.
No matter where you reside or conduct your trade, every community is made up of individuals and organizations that might be able to benefit your startup. Among these people is likely a small group of investors. A brief conversation at the local coffee shop could lead to a future business partner for you or even an investment opportunity for someone else. All it takes is some basic communication to spread the word about what you’re up to, and you could have several investors knocking on your door. Oftentimes, local small businesses, startups, and mom-and-pop shops catch the eye of investors compared to their big-brother corporate conglomerates. Investors love to see local businesses succeed as they are economic drivers for communities, so put your best foot forward in the community to find an investor like this.
3. Team up with your chamber of commerce and other organizations.
It’s quite an eye-opener to learn about the number of organizations and government agencies whose main purpose is to see the development of small businesses. While these groups may not be literally handing out $100 bills to entrepreneurs who visit their offices, there’s a good chance they can give you some guidance to seek out or attract investors. Many investors formally register with various organizations to make it known that they are looking for business investment opportunities. As soon as you get in touch with an investor or two, you’ll be on stage with the chance to put on a show, sell your idea, and hopefully bring them on board as a financial supporter.
4. Try your hand at crowdfunding.
A more recent form of attracting investors to small businesses and raising capital for newly outlined business plans is to use crowdfunding. The concept of crowdfunding, which is mainly done online, involves posting your business concept on a crowdfunding site and then letting investors find it. Investment amounts can be anywhere from $100 to $1 million in certain cases, but despite this variation, crowdfunding is a fantastic way of making others aware of what you’re doing – or what your future plans are. Whether you currently operate a small business that needs funding or are looking to develop a new product, crowdfunding can benefit almost all types of entrepreneurs, regardless of what stage they are in. This is because crowdfunding has a worldwide reach to investors in all corners of the globe who have Internet access. You might not get all the money you want through this practice, but it’s absolutely worth it to list your idea and see if any fish in the sea take your business bait.