One of the major impediments that entrepreneurs face especially in Africa is the amount of finance available on the market. While many have excellent business ideas, translating these ideas into functioning businesses quite often depends on the ability to connect with individuals or investors with enough capital and risk appetite. Below are some tips on how to attract investors and secure funding.
Get yourself connected and network – One of the most effective ways to find finding and suitable investors is through networking. If you don’t directly meet an investor, long lasting connections that you make will ultimately lead to something. It is a typical case of one thing leads to another.
Prepare a good story around your idea – Don’t confuse a potential investor with a complicated story. Present only essential elements such as marketability, sustainability and your own passion for the project.The simpler an idea is, the easier it is to buy into it.
Know all aspects of your idea and business plan – Deep knowledge and insight of the market and the industry you are interested in will always be appealing to investors. Investors want to know that you are experienced in the industry in which you want them to invest in.
Have a detailed business plan ready – A business plan is a clear and detailed illustration of your ambition. It will assist those who want to have a closer look and convince potential investors on your readiness. It is a confidence booster and guides you in the right direction.
Business plan must have powerful executive summary – The executive summary of a business plan must whet the appetite of investors.This is achieved by drawing a business plan absent of waffle or exaggeration.
Follow up detailed meeting – Do not be surprised if a potential investor requests for a follow up meeting after the initial one. Follow up meeting normally focuses on profit projections and industry insight.
Internet – You can use the internet to maximise on your exposure. Its always a good idea to have a good website regarding your idea and a strong presence on social media that highlights previous ventures and successes. All this will put you in good standing with an investor.
Communication – Try by all means to stay in touch with potential investors. It will also be in your best interest to remain open to feedback because the people that you pitch before are likely to have ideas which will enhance yours.
Exit strategy for the investor – It is important to remind yourself from the onset that few investors will want to be part of the business venture forever. For many, its about making the best possible returns in a limited period of time.You will do well therefore to include exit clauses in the whole plan.