Finding a place to meet potential investors, especially private ones, takes a mix of online resources and old-fashioned networking. As the startup economy booms, the power of the internet has enabled entrepreneurs with easier access to potential investors than ever before. While it is still crucial to have a solid business model and a feasible product or service offering, determined and talented entrepreneurs can find potential funding from the comfort of their homes. However, a significant amount of networking remains offline and entrepreneurs should not neglect these kinds of opportunities.
Let’s talk about how and where to meet potential investors
- What are the two most common types of private investors?
- 5 Common places entrepreneurs can meet potential investors
- 3 Top tips to follow before you meet potential investors
- Meeting potential investors is just the beginning
What are the two most common types of private investors?
In terms of private investors, there are two main types: “angel investors” and “venture capitalists”. Both of these types of investors will typically receive shares (that aren’t publicly traded) in the company in return for their investment.
What is an angel investor?
An angel investor is a high net worth individual who has the money, resources and background to make a business successful. If an angel investor comes on board, they are likely to contribute enough so that no other investors are needed. However, angel investors expect a high return on their investment. Generally, angel investors put forward their own capital and invest in the early stages of a company.
These types of investors will generally want to participate and have a voice in the day to day development of a business. There are online resources to find angel investors, such as the Angel Capital Association, for example.
What is a venture capitalist?
Venture capitalists are usually needed when a business is expanding, and as a result, perhaps heading into a riskier venture. They do not use their own money, but that of investors where they set up a fund that is used for others to buy shares in the company.
Although venture capitalists can help a startup, they generally come into a business once it’s already been established and has already proven to be successful. Typically the amounts required from venture capitalists are typically much higher than that of angel investors. However, the return on investment will also be predicted to be very high. As with angel investors, a venture capitalist will own shares in the company and have a say in how it’s run.
5 Common places entrepreneurs can meet potential investors
While most of our lives are spent in the digital universe when it comes to socialising these days, there is nothing better than a personal connection – whatever form it may come in.
A networking event is a gathering designed to help people meet other people. Generally, if there are investors in your area looking to pour money into a new startup, they can often be found scouting the local networking events in search of new opportunities.
It may take getting used to, but once you get a feel for the patterns of conversation and introduction, you should be able to quickly identify which types of people can help you reach your goals. Here, you can meet all kinds of new people who can also grow your business.
Hackathons and competitions
Sometimes, these work to launch new startups from scratch and other times they simply work on solving collective problems. These events are magnets for talent and new ideas which also makes them magnets for investors. By getting involved as a competitor or simply attending, can help you make new connections.
Volunteer events and community organisations are great opportunities to meet potential investors, people who may refer you to investors, or potential partners, etc.
Networking platforms, while online, are places used by entrepreneurs to meet potential investors on a daily basis. For example, AngelList helps connect startups with investors and workers.
Here are a few online sources for crowdfunding, investor matchups, and more:
- Angel Investment Network USA
- JumpStart (formerly IdeaCrossing)
Not a physical location or online gathering, making connections through mutual connections is one of the most popular and most effective ways to meet new investors. As some investors are tricky to meet in person, meeting them through a mutual contact may be the only way to reach them.
In a recent post, we mention multiple ways to find potential investors to pitch to. From start-up launch platforms to crowdfunding, we go over the top 10 ways to find potential investors based on what your business needs.
3 Top tips to follow before you meet potential investors
While getting a meeting with a potential investor is the goal, you want to be prepared before you even reach out to them. In order to increase your chance of success, finding the right investor or group of potential investors is key. From there, you need to be able to impress them with your idea and hook their interest to arrange a meeting. Here are the three top tips you should consider before reaching out to potential investors.
1. Research potential investors
It is always a good idea to thoroughly research potential investors using public information, social media, news articles, and more. This will help companies avoid chasing investors that will likely not be a good fit for the business or will not be interested in coming on board.
A top tip is to pay attention to their current portfolio and develop an understanding of their investment history and success rate, etc.
2. Perfect your executive summary and Business Plan
The executive summary and Business Plan help investors decide whether or not they have an interest in meeting with the company. These highlight the relevant facts about the company, products and services, target market, and more in a way that speaks the investors’ language. When looking to create your Business Plan, specialised software like Brixx can help create comprehensive financial projections to impress potential investors. Sign up for a free 7-day trial.
3. Be presentation and pitch-perfect
Investors see plenty of pitch decks and the key is to bring your pitch to life in an exciting way. A Startup’s Guide To A Winning Investor Pitch Deck” takes you through the ins and outs of the basics of creating a pitch deck. While you should use a customisable pitch deck template to get an idea of what investors may be looking for, you should be sure to structure your elevator pitch and presentation to match.
In your elevator pitch, you should delve into the history of the business as well as how it will make the investor money within a minute or two. With your presentation, on the other hand, the total presentation should be less than 30 minutes long. You should spend approximately two to three minutes on each slide you’ve created in your pitch deck.
Meeting potential investors is just the beginning
There is a growing popularity of online investment matchmaking. However, a significant amount of investing happens offline. This could be because entrepreneurs tend to see the most success accessing investors through personal connections or referrals. In turn, investors can get a better insight into who they would potentially be willing to hear out.
Whichever way you choose to find funding, you will still need to ensure that you have everything else prepared before then. Brixx offers resources on how to create a detailed Business Plan, create financial projections, design an investor pitch deck and more. Be sure to visit the Brixx blog for a number of free templates and insightful posts.