WHY look for investors
First thing you need to ask yourself is why do you actually want investment?
There are a couple of different options available where you can get your investment from. But first, you need to make sure that you know why you need investment.
You might be a startup seeking seed investment. If you've invented a faster product, a better product, a cheaper product, perhaps some new Intellectual Property.
It could be for working capital, this is really making sure that you've got operational liquidity, can pay your bills on a monthly basis, pay staff.
Perhaps you need some new assets that you need to acquire to grow your business.
Other product reasons could be for the product development itself but it also could mean internationalization. That's going into another country meaning you need new infrastructure, new staff, new processes, new buildings, and so on.
So have a think about why you need investment and let's have a look at what the process is around that.
Next we want to know when is the right time for investment.
Before we start thinking about that, we need to understand the actual process about investment and when you can get it. Generally the whole process will take between three to six months and will start from the day you meet the investors. When you do go for the investment, what you want to make sure is that you put together a capital plan. This is really understanding the cash flow, the cost structure, some of the milestones you want to achieve, and really what you want to get out of this investment.
There are a couple of different value strategies that you can apply and that investors want to see when you come for a pitch.
If you want to grow your business, you need to have an implementation plan around sales and marketing of your business.
If you are creating a new product, perhaps you want to understand exactly what the research and development costs are and come up with an implementation plan for these.
Lastly, you want to have a look at the market, a new market that you're going after, but really understand the geographies, the culture, the social norms, a little bit more statistics and data around, as well as the implementation plan of how you're going to get it.
Before diving any deeper, have a pause here and really understand why you are seeking investment. Is it for seed capital? Is it for operational expenses? Or perhaps you're looking to acquire some more assets? Understand why you need it and that's going to make the whole process a lot easier.
Next you want to have a look into when you're seeking investment. As the process can take three to six months, sometimes even longer, you really want to start looking for money before you actually need it. So really know what is your cash run, what does your runway look like, and plan accordingly to make sure that you don't run out of funding.
Last, you want to understand your implementation plan. So whether this capital that you seek, it is for growth or new product development, have an implementation plan, plan of execution of what it entails to do that research and development, what it entails to find these new geographies or these new markets that you want to tap into, or perhaps even if it's growth for your company, really understand what it takes to implement on your sales and marketing strategies.
Ask yourself why you are seeking investment. Answering this question will make your whole process easier. Next, ask yourself when you are seeking investment; start looking for money before you actually need it. And lastly, try to understand your implementation plan.