Whether you currently have a business or intend to have one soon, there’s a good chance that you’ll likely want to seek funding from investors. Even if that time seems far from now, it’s still important to keep an open mind about it happening eventually. That’s because financial support from investors can take your business to the next level and allow you to do things that otherwise may prove impossible.
There are certain things you should think about when assessing how you’ll know when it’s time to meet investors. The content brought up in detail here should help you feel more confident about reaching a well-informed conclusion.
How Have You Spent Money Previously Available to You?
One of the things to assess regarding investor readiness is what you’ve done with financial resources made available to you in the past. In other words, can you demonstrate to potential investors that you’ve converted that money into revenue for the business? If not, investors may worry that you’ll get caught in a wasteful pattern instead of using the money to further your business and make it profitable.
If such statistics are at your disposal, gather data that shows the amount of money available to you versus the revenue generated from it. Doing that will help investors see the hard facts and increase the likelihood that they believe you’re responsible with finances.
Do You Have a Thorough Business Plan?
Your business plan is an aspect to not overlook if you’re getting ready to meet investors. It should include things like a business name, logo, the market need, and how you will get your product to the public. The business plan will undoubtedly be one of the central parts of your first meetings with investors. If you’re worried that it’s incomplete, or if a trusted advisor has warned you as such, go back and retool it.
If you believe supplementary materials such as slides, graphs, or videos would support content in the business plan, feel free to use them. Since the business plan is such an integral part of your overall pitch to investors, it’s a good idea to practice speaking about it in front of friends or family members and getting feedback about your delivery.
Why Are You Seeking Investors’ Money?
Investors almost certainly won’t give you financial resources unless you can clearly state how you’ll spend them. Moreover, they’ll want to see that you’ll use the money to help the business grow rather than relying on the funds solely for experimentation.
For example, maybe you want to take the business into a new market or introduce a new product but you lack the necessary funds. Those are both examples of actions that could promote growth for the company and show your future-oriented mindset.
Do You Have a Strong, Reliable Support Team?
It’s helpful if you have what seems like a brilliant business idea and a rock-solid plan to make it happen. But, you can’t realistically do everything alone. That’s why it’s so important to have people around you who are committed to the same goals that you are and ready to provide assistance through all the ups and downs of running a business.
If there is internal strife within your team, don’t be fooled into thinking that you can ignore the problem and power through with attempting to get funding from investors. The people who provide financial resources for your business may not immediately notice issues with your team. But, if there are vastly different opinions about how to run the business or which goals are most important, those variations could prove problematic.
Can You Handle Being Under Pressure and in the Spotlight?
As you go down the path of trying to get money from investors, you’ll probably present your ideas to extremely prolific investors. For example, although he has now retired from venture investing, Chris Sacca invested in companies including Instagram, Uber, and Twitter. That gives you an idea of his impressive foresight.
Then, if you want an example of how those endeavors paid off, just look up Chris Sacca home information. He owns a Manhattan residence sandwiched between two downtown beach districts.
Sacca is extremely well-known in the investing sector. The point is that there may be instances where you have to describe your business to experienced people and cannot feel intimidated while doing so.
You may even get the opportunity to be on a TV show to pitch your idea. Acquiring funding from investors can feel overwhelming, but you’ll need to get comfortable with being calm under pressure.
If you’re still a long way from being able to do that, remember that practice makes perfect. It could be worthwhile to deliver your pitch in lower-pressure environments first instead of immediately giving it to the investor or investors you want to meet with the most.
These are not the only questions you should use to gauge if you’re prepared to meet with investors. However, they should provide a valuable framework that revealed your strengths, as well as where room for improvement exists.