Looking for new investors in your business? Then get ready to woo them: the relationship between investor and business is like a marriage and needs chemistry and strong mutual attraction to make it work, says a top US venture capitalist.
Thinking you’ve outgrown your small business boots but unsure how to proceed to the next step? Dreaming of world domination? We have some tips for you.
Some 130 female leaders have just been given lessons in pitching to angel investors and venture capital funds at an entrepreneurs’ gathering that concluded today in Rio de Janeiro, Brazil.
They participated in a workshop with investors who have between them more than US$600million and plenty of expertise to dish out to promising start-ups around the world.
To pitch successfully first, be clear about your goals for the company. Then decide what you want from them. Next define your exit strategy and timeframe, including exploring your personal feelings about it.
Now be prepared to pitch your idea clearly and very quickly - first impressions are key.
“Even if you think you’ve got a lot of time, hit it in the first 30 seconds,” said Lauren Flanagan, managing director of Belle Capital PL based in Michigan, US.
Flanagan currently funds 12 technology-driven companies through two funds. She plans on funding 30 in total.
In a few minutes hopefuls must include a brief description of the business, product or proprietary technology; a rundown of their market potential, plans and their unique leadership capability.
“Investors look for entrepreneurs with confidence, energy and a track record. Be specific, highlight the return for the investor and the timeframe,” she said.
Importantly, Flanagan and other investors presented at the second annual Dell Women’s Entrepreneurs Network (DWEN) conference said the investor-recipient relationship had to “feel right”. It is like a marriage, it needs chemistry, they said.
“It is not just because it’s green that it is good money. You want to take money from the good people who will bring true value-add to your business.”
They cautioned keen business owners not to feel obliged to accept offers in desperation.
“Plan ahead and get the funding before you are desperate, because you might be creating another problem if you don’t choose the right partner,” Flanagan said.
Amy Millman of Springboard Enterprises which is planning to fund businesses in Australia next year, said presentations should include five key differentiators.
“Something that paints a picture about your product or business that investors didn’t know already,” Millman said.
Flanagan said male investors viewed women-led businesses differently, hence her focus on female recipients.
“Generally women investors have an understanding of what it is like to be on the other side of the table, but being a woman is no guarantee of being nice. You need honesty and respect in the relationship”.