Foolproof Tactics To Attract Venture Capital Funding

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When you are running a small business, your plans for growth are likely to be stifled by one big thing: money. There are, of course, various ways of getting it - a bank loan, for example, or borrowing from a family member. But what if you want to attract serious investment? Your best bet here is to find funding from angel or venture capital investors.

It is, however, a complicated process. There are countless businesses out there, all trying to attract the limited pool of angel investors that exist for every industry. It’s critical to make your business an appealing opportunity - and we’re going to show you a few ideas to help you achieve that right now.

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Network

First of all, get used to networking. Your local startup and small business community will all be looking for investment. You’ll find that many investor contacts will engage with the scene. It’s their business to keep their eyes and ears on the up and coming business opportunities. And, if they like the sound of what you are doing, they will keep a conversation open with you. It’s the art of the soft sell that you need to embrace, here - put yourself out there, e friendly and compelling, and who knows who might hear about you?

Softly, softly

While we are on the subject of the soft sell, try to avoid being too desperate. Venture capitalists receive what appear to be begging letters on a regular basis - the vast majority of which are never read. You are far better off asking for advice, rather than acting like a pushy salesperson. You might even start to develop a relationship with the investor, which could pay off in the long-term.

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Understand the market

If you want to attract angels and venture capitalists, you have to think like an investor. According to The Fortunate Investor, 'savvy investors build long-term wealth.' With this in mind, how can you make your business a better long-term prospect? Are you working towards an exit strategy? Is your business future-proof? Are you committed and do you have the right team behind you to secure your business for the coming five years or so? And, most importantly, are you in a position where you can handle scaling things up to a level you haven't experienced before?

Prove your success

You need proof that your business is viable before any investor will be interested in what you do. It is critical, then, that you already have customers. It will show an angel or venture capitalist that people like your product or service, and there could be an opportunity for expansion. Without those initial successes, you will be a risk, rather than an investment opportunity.

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Look for a partner

Avoid looking for a money only - seek out a partner instead. Giving up part of your business is part of the process of getting investment. So, you are better off looking for someone who is keen to climb on board for more reasons than the financial aspect. Seek out investors that can have a tangible impact on your entire business and you will find you have a much stronger company than before. Good luck!