Donald Trump has made a lot of money. But he was also given a lot of money in the first place. His father gave him over a million dollars to start his real estate business in Manhattan.
But what about entrepreneurs who aren’t so fortunate? What can they do to build businesses quickly and get the finance that they need? A lot of entrepreneurs try bootstrapping their way up. But often, that’s not the best solution. It can take a long time to build a business from scratch, and some businesses just need cash quick. So how should entrepreneurs approach investors? And what should they do to avoid the word “no” when asking for money?
Be As Professional As Possible
The best way to approach an investor isn’t to think of them as somebody who has a lot of money. It’s to imagine yourself in their shoes. How would you feel if a startup entrepreneur came to you with your idea and asked you for money? Getting investors to say yes is all about showing empathy for their position. After all, it’s their money that’s on the line if everything goes wrong, not yours.
If your pitch isn’t successful first time around, don’t just go back and try a second time. Make sure that you fundamentally change your pitch, incorporating the feedback from interested investors. Let them know that you’ve taken on board their advice and that you’re trying to improve your product. The more you assuage their concerns, the more likely it is that you’ll get the offer you want.
Contemplate Your Options
Let’s say you’ve pitched your business to an angel investor and they’ve repeatedly said no. It’s a bummer, but it doesn’t mean the end of the road. In today’s fractured lending market, there are potentially dozens of ways to secure finance. Getting a cash advance online, for instance, bypasses traditional lending routes. And at the same time, it gives your company much-needed capital upfront. Choosing the right channel for your business depends on your funding needs and the nature of your firm. But don’t just assume that the only way to get a capital injection is through private investors. It’s not.
Make Changes To Your Business Plan
Investors often reject a business, not because of it’s product, but because of its plan. Some products are great, but the companies behind them just don’t know how to use them properly. Imagine if Google had only invested in search. Sure, it might have gotten thousands of people to its site every day. But without advertising and paid search, the company would have made very little revenue.
Investors might also have a problem with some of the assumptions built into your business model. For instance, you might want to target consumers in China. But your investors doubt whether your product will actually gain any traction in the country.
Investors might also worry that your product has a limited window of profitability. This could happen if technology is changing rapidly. It’s important that this information is considered and that companies listen to investor concerns. Products can always be adapted to suit market conditions.