The Secret for a Successful Capital Raising

How many times have you wondered which strategies to apply to attract investors and funders?

Whatever your motivation to raise capital is, one of the first aspects to consider is the way you introduce yourself and what your company does. Investors want to get a clear idea about what you are doing, how the company is run and what are the terms of a possible investment. You need to show that you have a clear business plan and strategy.

To target the right investors, you can look for those who have already invested in a field similar to your sector. You might meet these people at conferences or industry events, or be introduced to them via mutual connections. Alternatively, you can enlist the help of another business, such as a Venture Capitalist (VC), or a platform, such as an equity crowdfunding platform. Whilst a VC will invest in your business with its own funding, equity crowdfunding will market your offer, introducing you to investors.  

Attract the investors using a pitch presentation that has to be brief and simple. In it you should include a cover page, a summary, the team, the problem and your solution, an overview of the market and your competitors, your business model and financing. Make it catchy and clear: investors are likely to have listened to many of these presentations. 

Differentiate what you do. Think about the whole production chain: from the moment in which your customers understand that they need your product until when they will not use it anymore - you need to be different from your competitors. For each step of this chain you have to analyse the customer’s experience and its feelings towards your product. What is your unique selling point? What does your product offer that competitors cannot imitate?

It is very important that you understand what your potential investors are interested in and to present what you can offer them in a transparent and quantifiable way.

That is why you should not be shy about showing numbers. How many people are using your product or enjoying your services? How many problems has your product solved? Give statistics on past growth, revenue and potential markets. Be clear on what your revenue model is and how that might evolve. Show trends domestically and internationally that impact your company positively.

Lastly, think about an exit plan and present it to the possible investors. You need to reassure them that they will have their returns in the future. Remember that investors do not get any money back until the company has an exit or pays dividends.

If you keep in mind these tips and remind yourself that the key word to attract new capital is transparency, all you need to do is enjoy your adventure.

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