I have a good business plan and am looking for an investor. Are there any resources or organisations I can use to find one, or is it best to look informally at acquaintances first?
Before you start speaking to investors, you should first do a number of things to ensure that the investor will not be turned off by your approach.
Being unprepared when approaching investors is probably the single most common reason why entrepreneurs fail to attract capital. Some investors see 10 or 20 deals a week. If your proposal does not include a checklist that I have previously outlined, chances are you won’t get past first base and they are immediately onto the next deal.
However, once you learn how to make your business “investor ready” and you succeed in attracting an investor the first time, going for subsequent rounds of funding, or funding a new venture becomes much easier. Hence, if you want to become a successful entrepreneur, it’s worth spending the time and effort to learn how to make your company “investor ready”.
Once you have this in place, here are some ideas for locating potential investors:
- Your own networks. Ask the people you know if they, or people they know, would be interested in investing into a private company.
- Angel Investor Networks – go to http://www.aaai.net.au/ and find an Angel Investor network in your city. Register and attend one of their meetings.
- Go to http://www.wholesaleinvestor.com.au/public_panel/event_list.php and register for one of their upcoming investor networking events in your city.
- Go to www.avcal.com.au where you’ll find a list of private equity and venture capital firms to contact.
Most importantly, if you seek to be successful in raising capital, you must first understand what’s involved and how it works.
So read books, attend events and learn from those you know who have been successful in raising capital.