Starting a new business can take a lot of money and sometimes outside investment is needed. There are plenty of investors out there that are willing to help, but you must make sure you know the right way to ask, or you may not get the money. Try to avoid making these common mistakes when seeking funding for your new business.
Too many people wait until they need the money to ask for it, this may be a mistake. If you think you may need extra capital to start your business, you must begin the process as soon as possible. The process of raising capital can take many months and waiting till the last minute may be too late. The time to seek capital is when you don’t need it. It’s ironic but you actually have a better chance of getting capital when you don’t need it.
The importance of having a full business plan can not be overstated. Banks and investors will want to see a complete business plan before they even consider giving you money. Banks and investors want all their questions about where and how the money will be used and where the business plans to be in the future answered. Do your research now and increase your chances of getting the capital you need.
If you’re fortunate enough to get an audience with an investor, make sure you have a plan that includes what the next step will be. You may have an excellent executive summary to deliver, but nowhere to go from there. Make sure you end your presentations with a plan on what comes next.
Don’t forget to follow up. You may have delivered the ultimate presentation and got everyone excited, but it could be all a waist of time if you don’t follow up. Bankers and investors are busy people, it’s up to you to follow up and remind them of the great opportunity you have to offer.