How to find, win over strategic investors for your startup

Investors want someone who will use their money wisely
Investors want someone who will use their money wisely. PHOTO/FILE
A good business idea is crucial to winning financiers but it takes much more to convince investors of its viability and ability to give good returns on investment.

Budding entrepreneurs should know what prospective financiers need to hear and see since they tend to be very choosy, and rightfully so, on where to invest their hard earned cash.

Use the following tips to help you deliver a persuasive investment pitch that will get investors hooked within a few minutes.

1.) Impression
The first impression can make or ruin your pitch. In order to be taken seriously, you have to look the part. Dress appropriately depending on the company you are presenting to.

Be confident but do not go overboard in a bid to imply that you have everything under control since it can be mistaken for arrogance.

In addition, be honest especially when you are not sure of something – keeping in mind that investors are experienced and can see right through your bluffing.

2.) Business plan
To help your audience have a better understanding of your goals, strategies on marketing and tackling competition as well as financial projections, it is important to have a business plan. To help the investors grasp your concept easily, include a catchy tagline that specifies the benefit of what you have to offer.

3.) The team
The investor is interested in knowing who will turn your idea from a dream to reality. Most investors are inclined to fund a business comprising of a talented management team as opposed to a one man show.

READ: 7 Ways to start a business without taking bank loans

Though their roles are indicated in the business plan, you should expound on their qualifications, strengths and experience in the industry. The more diverse the team the better to make certain there are no missing links which can create doubt among the investors

4.) Niche market
Show proof of demand. Explain the need in the market that creates an opportunity which your business seeks to solve. To best convince your audience of your idea’s viability, present the problem and the solution such that it relates to their day to day experiences.

Demonstrate that you clearly understand your competition, their weak points and what sets you apart to ensure your business curves its niche and becomes profitable.

5.) Ask for what you need only
Startups will require financing in different stages as they grow and although you have projections for several years to come, you should focus on funding a particular objective first then later on look for more funding when the need arises.

An entrepreneur who makes flowery projections and is willing to give up too much equity for more money will raise eyebrows among investors.

Investors want someone who understands moderation and will use their money wisely. More importantly, do not just throw figures around; have a detailed worksheet of what you require.

6.) Listen and respond
Make your presentation simple and to the point. Do not bore your audience with a monologue. Give them an opportunity to ask questions and make an effort to answer them exhaustively.

Be sure to make eye contact with everybody and monitor their body language or facial expression by looking out for questioning looks and concerned faces and prompt any that you spot to raise their concerns.

7.) Persistence
The demand for startups funding exceeds supply which sees investors receiving more pitches than they can possibly handle. To grab their attention you need to persistently make relentless follow ups and show the progress and the milestones you have met over time.