How to Impress a Potential Investor
*Find your passion. If you are enthusiastic, your investor will be, too.
*Remember, you are an entrepreneur. You know your business inside and out. In essence, your potential investor is investing in you, not just your business.
*Prove your business works by providing evidence of paying customers. Get your customer¡¯s comments and opinions and offer this information.
*Don¡¯t limit yourself to just one investor. Get yourself out there. Tell anyone you know what you are doing. You may be surprised on who you may find is looking to invest in a business.
*Save yourself time and money but sending out your idea summarized in two or three pages. Like yourself, investors are busy and you don¡¯t want to waste your ideas on someone who may not be interested in what you have in mind.
Great Business Plan = Winning Over Investors
How much time did you invest in your business plan? Your idea may be wonderful but how you say it may not come across as well as you think. Find a business plan writer to edit your plan, so your ideas come across clear and strong.
Think your business plan will result in a return on your investment in a few short years? Your three to five year financial projections should include your idea of how soon a return can be expected by investors.
Also, don¡¯t forget to include a fair evaluation of the competition. Knowing your competition proves you know your business.
Finding Venture Capital
You do not have to have a business to get venture capital. New entrepreneurs may be able to gain capital based only on a business plan.
Investors are always on the look out for a possible successful business to invest in. You no longer have to try to borrow money from a bank to help start your business. Try looking into possible investors for your business. For more information try the National Venture Capital Association at http://www.nvca.org.
Good and Bad Investors
You do not have to take any offer that is presented to you. You should research the investors as much as they are searching you. Find out if they have invested in other companies before. What happened there?
Do you really feel the investor is interested in your company? Is your investor as passionate about your products as you are? Ask yourself these questions while you consider the offer.
Self Evaluation of your Business Opportunity
Would you invest in yourself? Sometimes you can save yourself a lot if time and trouble by taking a critical look at your own plans and ideas. If you had the money to invest in your business, would you?
Be honest with yourself. Would you take out a mortgage on your house to invest in your business? Many investors may ask you this question or similar ones. If you are not willing to invest in your own business, why should your investor? Make sure your plan is as solid as it can be and that you believe it in enough to help others believe in it, too.
What Venture Capitalists Do
You may have heard the term venture capitalists, but what do they do exactly? Venture capitalists are interested in helping you succeed. Venture capitalists may finance new and growing companies and assist with the development of new technologies or products. They think of long-term relationships with companies. They provide the funding and the company produces a way for them to make money off of their investment.
With any investment, there are risks involved, not every business is a success. Venture capitalists have to evaluate these risks and made decisions based on plans and well thought out ideas. If you have an innovative business plan, it may be worth it to find a venture capitalist that would be interested in looking at your proposal.
What is Venture Capitalism?
By definition, venture capitalism is a monetary system based on the trade of wealth, in other words, a business or an individual, and the people or companies invest in an innovative enterprise where potential profits are large.
In more simple terms, it is the opportunity to invest in a young company that has the potential to grow into a big enterprise. Imagine someone who runs a great hamburger restaurant. He wants to expand his business by opening a restaurant in another city. He may ask for investors to invest in his company. In exchange, when the company succeeds and finds a profit, the investor may see a return on his investment with interest or he shares a percentage of the profits.