By Eric Greene
As a success/leadership coach, I work with founders and entrepreneurs on a constant basis. Several of these folks have succeeded in raising funds that have subsequently helped propel their businesses. Knowing how stressful this fundraising process was for each of these folks, I thought I would pass on their very best hidden advice. Not necessarily the obvious stuff that you can get generically, but rather more subtle, less obvious tips.
Here goes, straight from the mouths of entrepreneurs – 8 not so obvious tips for raising capital:
- Don’t let them see you sweat
“If you aren’t confident in your business, nobody else will have confidence either,” says the founder of a now $1 million-dollar consumer products company in the outdoor industry. “You need to find a little inner swagger. Show that you believe in your vision, the need it serves, your product, your marketing and especially your team.” - Prove that you have real prospects, meet a real need, real prospects and a true path
“You need to be vivid on who your customers or prospects are, and what your track record is in selling to those prospects and bringing in revenue,” says the CEO of an emerging company in the natural foods space. “Can your product sell and make money, and what is your momentum? This is what investors need to hear.” - Be a storyteller
“What is the story? Be able to tell it,” says an inventor and founder in the mountain bike category. “Every good story starts with a hook. Why is there a need? What happened that made you discover the need? What’s the problem and how are you solving it? Why does the world need your solution? Practice your story until you can tell it in an awesome, vivid, powerful way.” - Don’t be afraid of numbers (be results oriented)
“In the end, numbers don’t lie. Don’t be afraid of numbers. Use them to show your progress, as results speak louder than words,” says a founder/CEO in the tech space. “Real numbers and demonstrated progress raise trust with investors. Instead of being nervous around numbers, know them and learn to use them. You don’t have to be a CFO; you just need to be able to speak to results and progress.”
5. Have a plan, and have strategies for optimizing your business
“Investors want business leaders who recognize the key success factors that will make their business grow and thrive,” says a founder of three separate service businesses. “Know the handful of key success factors key to making your business go. And demonstrate that you are seeking ways to make each key aspect of your business run smoothly.”
6. Get good advice to better your chances of getting investment money
“Get other sets of eyes besides your own on your proposition. Seek out other successful, experienced people who have been there, done that, to eyeball your plans and investment pitch,” says a founder in the software industry. “I was amazed at how this helped and the ideas these people had for making my pitch better. This made all the difference.”
7. Yes, have a plan and a market
“It sounds simple, but you need a viable plan. What’s the market? It is sizable enough? What is your targeting and marketing strategy? Does your offering and strategies have enough competitive advantage to succeed?” says a founder/CEO in e-commerce. “For investors, there is always risk, and a good plan helps them see that the potential reward is worth the investment.”
8. Don’t be a poser
“Above anything, be yourself. Don’t pretend to be somebody you are not,” says a co-founder in an emerging regional podcast network. “In the end, an investor is betting on you, even more than they are betting on your plan. “They have to believe in you. And they will only believe in you if you are real.
So there you have it – 8 not so obvious tips. Hope these help as you seek to raise money, be it from private equity, banks, even from crowdsourcing. You got this – and these tips can help
Eric Greene is a proven executive and entrepreneur turned success/executive coach + advisor at the Greenehouse (www.GHouseCoaching.com). Pouring my experience into helping you work smarter. Lead better. Stress less. Have more fun doing it. And kick way more ass along the way.
