CHAPTER TWO: Part C – In addition to having the qualities or traits listed in Part B of this chapter, I have highlighted six additional measures you can adopt or implement to further prepare yourself for the harsh challenges you will face while trying to raise funds for your business. Below are the six additional action tips.
1. Plan the fund-raising exercise itself
After you are done with writing your business plan, it is advisable you invest time and effort to plan the fund raising exercise thoroughly. A good way to start your planning process is to make a list of investors and creditors that you plan approach as well as their contact details.
Also, you should document the total amount you are looking at raising and the deadline by which you hope to have gotten the funds you need. Such a plan would help you act with time and remain focused.
2. Be analytical
Most investors and creditors won’t trust your idea or business until you show them detailed analysis of the concept as well as your projections. Don’t just state facts; you must use figures to drive home your points and add weight to your projections. You must also take your time to research extensively about your business idea, and have a well-written business plan (you will learn how to craft a good business plan in the next chapter). Investors will only invest in what they know and understand.
3. Be succinct
Without excluding any relevant details, you must be able to present your proposition in as few words as possible. Most investors or lenders are very busy individuals who always have multiple tasks to handle. So, you would only bore them and kill their interest in your idea if they would need hours of reading to understand your proposal.
If you are called upon to present your business plan, be precise and go straight to the point. After presenting your overview / summary, you should then proceed to answer any question your investors / lenders. Only focus on areas your investors care or want to know about your business.
4. Be realistic
It is also important that you set a reasonable deadline for your fund-raising plan. Always keep in mind that investors and creditors would need some time to analyze your idea and ruminate over it before giving their feedback. So, never expect them to respond with hours or few days. However, it is advisable and wise to let your potential investors / lenders know that there is a expected time range, within which you expect their feedback.
If you are raising startup capital for your business, then chances are that you won’t be able to secure loans from most banks and some other money-lending institutions because these institutions want a certain degree of safety, track record, credibility and competence on the part of the fund raising entrepreneur. So keeping these “no-go” areas out of your list of options will save your time and save you from frustration, as you will focus more on creditors and investors that are more likely to buy your idea.
6. Be clear on what you want to achieve
The most brilliant business idea in the world can come across as a ruse if it’s presented in a way that is not clear enough. So, clarity is a very important factor that can spell the success or failure of your fund-raising quest. In written proposals, try to use pictures only if they would make your ideas clearer. In presentations, you can add animations and videos as well as graphs and other illustrations. And when you are presenting your ideas orally, speak clearly.
As a final note, I want you to know that raising capital does not have to be a laborious, drawn out affair. Though, it’s not an easy task, you can make yours easier by keeping to the points raised in this chapter. By following the action tips stated above, plus a little touch of creativity on your part; you will be able to provide investors and lenders with confidence, and all the money you need will flow over to you.