Portfolio | Biz innings | Startup Funding

How To Attract Investors To Your Startup

2016 was the death year of startups, in 2016 lack of funding was the major reason for startups shut down, while in 2017 due to lack of market demand many startups hanged up their boots. 2018 seems to be comparatively very good, many Indian investment companies and individuals started investing widely, so that’s a great news for all potential startups. So let’s look into some best practices to attract investors this year.

Have a strong product

A recent CB insights report says 42% of the startups who started thinking they will change the world are not required at all, they are either copy products or outdated business models. Investors get attracted to the products that solve the problems. Innovative products attract more investors, so don’t create a product just to attract investors, have a strong passion and love to your product and show the world that your product has potential to change the world.

Have great Co-founders

I strongly believe, investors don’t invest in businesses, they invest in people, It is the combination of great product and strong team that attract investors. Investors are more interested in companies that have co-founders, it is strongly believed that the core team play the major role in uplifting the business. So try finding co-founders who are as passionate and as dedicated as you are.

Market yourself

I meet hundreds of entrepreneurs every month, the major cons I find in them is, they are nowhere known in the market. Despite having a great product and doing great business, their names are not heard in the business community, It clearly shows how badly they failed in marketing them self. I recently met an entrepreneur who is doing a turnover of around 20 crores a year, I am surprised to see no one are even aware of his existence. It clearly shows how badly he failed in marketing himself which may lead to the collapse of his business in future.

I was talking to one more young entrepreneur and he said, many bloggers are behind him for interviews but he is not interested in talking to them, I asked why? and he carelessly said he doesn’t get anything out of it, I was surprised with his answer and then explained him the importance of creating strong presence across various platforms and he felt guilty for not doing it all these days.

If searched on Google by your name, you should have your presence in at least 20+ third-party sites, be it your interviews, your opinions, your success stories and your videos. If you are a good communicator, take some time and create a strong online presence, motivate people on the social platform with your experiences. Join business groups and Aluminis and be social with your other peers, have a blog and motivate people with your writings.

If you are not a great communicator, hire people to do it for you, reach top online bloggers and give them your interviews and share your success stories, they will take care of the rest. Investors get attracted to strong personalities, so show them that you are the one to watch out. Creating strong self-online presence will not only have a positive effect on your personality it is also the best way to market yourself to attract investors indirectly.

Keep in touch with Investors to gain traction

Don’t rush to investors only when you are in desperate need of funds, instead, have a close eye on who is the potential investor and reach them for suggestions, ask them to mentor you, and try to establish a long-term relationship with them. In this journey show them the potential of your product and attract them to invest in your business.

Have a clear ROI pitch

Hundreds of startups reach us every month for funding, surprisingly not even 1% of them are clear on what they want? they look very confused and has no clarity on what amount of fund they actually require, how many shares they want to dilute and how to use the newly wired funds. Remember Without data, you’re just another person with an opinion”, investors are least interested in those who fail to have a clear ROI.

You should be able to tell the investors what you are looking for exactly, what percentage of share you are going to offer, how will they be paid back and how much X times his money gonna grow over a period a time. Do strong homework in creating a “WOW ROI”, because investors love entrepreneurs who talk with data.

Biz Innings

 

 


By Chaitanya Gundluri

Chaitanya Gundluri is a Serial Entrepreneur, Business Investor, Interviewer, Passionate Marketer, Business Blogger and an Influential Sales Leader.
One Comment

Add a Comment

Your email address will not be published. Required fields are marked *