Business Angels Taking the Risk
When you're building a new business, or looking to expand your old one, the first thing you'll always need is money. Money doesn't just grease the wheels of business, as the old adage goes - money is the wheels of business. Everything in business depends on it, and if you can't get funding, your business plans will never even get out of the starting gate. So, what do you look for in an investor? Some investors, called venture capitalists, represent large bases of other investors and, as such, are spending their money on your project, much the way a stockbroker or investing firm works.
On the other hand, there also exists a kind of investor who invests his or her own money in starting companies. They're taking a risk, and are often careful where they invest, but they do invest somewhere - and with the right sales pitch, that somewhere could be your company. These investors are called business angels, and work either singly or in pools of capital. They may invest now, while shares are cheap; wait a few years for your company to mature, and then sell to other stockbrokers or back to you, if you've made enough profit.
The problem, of course, is that business angels are investing their own capital. No one, as they say, is more careful than a man spending his own money - business angels will be very careful where and what they invest in, so you'll have to have a bulletproof sales pitch, if you expect to succeed and get the funds you need. A key here is preparation. Before your first meeting with your investors, make sure you know everything there is to know about your company, your market, your target audience, and your locale - nothing impresses people more than a ready answer for every question and plenty of hard evidence.
Also, make sure you have a good, clear business plan. Know how many people will be on your payroll, what equipment you'll need to buy, what office space you'll be renting, and how all these expenses translate into profits at the end of the year. Without a clear idea of how you're going to make money, investors will be reluctant at best. Know the means by which you'll get your cash, and you'll better be able to predict the results to others.
Prepare for questions before you go into the meeting. Think about what you might ask if you were in the investor's position. Questions like "how much do you expect to make the first year," and "how do you expect profits to rise over the next decade," are to be expected, as well as other questions more tailored to your specific situation. Know your unique selling points - what makes you stand out from the crowd? Why should the investor choose to give money to you instead of the next guy or the next girl in line outside the investor's office? Show them you're unique, and you'll de facto eliminate the competition.
Much of the way these meetings is entirely psychological. Make sure you yourself are confident in voice and posture. Know you can make money and you'll be much more confident when you make that claim to an investor. A straight back and a strong voice do wonders and can often be even more effective than strong logical arguments for what you say.
Make sure you're committed as well. If you haven't invested as much of your own money as possible, investors will suspect you of scamming or of not trusting your own company. If you're heavily invested in your company with both time and money, investors will be more likely to believe your commitment to its successful completion.
Related Tags: startup business, business angels
Adrian is the webmaster at discount domains, one of the UK's leading registration services Your Article Search Directory : Find in Articles
Recent articles in this category:
- The No. 1 Rule For Projecting Confidence - Speak With Authority
One of the most important characteristics a person can project in a business setting - or any situat - After the Autumn Checkout European Debt Crisis and U.S. Brewing Rebound
In the commotion caused by the Fed on interest rates come to an end, the "disastrous" for the euro a - Advantages Of Arcade Game Rentals
There are many different advantages to arcade game rentals. Most people need something to release th - A General Primer on Truck Cargo Nets
In modern highways it is quite rare to see truck cargo nets in action, this is because they are usua - The United States Will Burst More Severe Financial Crisis
Not long ago, suddenly announced that the central bank to raise interest rates, the interest rate hi - Niche Marketing Profits - 3 Easy Steps to Finding a Profitable Niche Market Income in 10 Minutes
Like most beginners I was having a very difficult time trying to find a niche market to earn extra m - The Importance of Hospitality Management Consulting Firms Toronto
Businesses and the managers that help guide any business are in a constant state of improvement and - New Keynesian Theory Label
2010 winner of the Nobel Prize in Economics three theories have been labeled as "New Keynesian" labe - Federal Reserve Pouring Money QE2 Unpredictable Fortune
U.S. economist Milton Friedman proposed a "throw the cash from a helicopter" view, while the practic - Fiscal Consolidation Should no Longer Delay
British Chancellor of the Exchequer George Osborne today announced fiscal consolidation policy, shoc
Most viewed articles in this category:
- Common Financial Problems to Avoid
One must first change their habits and not procrastinate. American Consultants Inc at offers key fi - How a Bad Hire Can Hurt Your Business
What's worse - hiring the wrong person or not hiring anyone at all? Companies can become almost des - Joel Comm Is Dr. Adsense
What is Adsense? If you are new to making money online and net marketing, you may not know what Ads - 5 Steps For A Dynamic Wealth System Online
Recipe: Opportunity + knowledge + Dynamic Wealth System + Your Action = Massive Success!!! Step 1 - How To Stop Foreclosure
Losing your house to a foreclosure can be very scary. There are times when circumstances are ou - How to Always Pitch A Strike
As business owners, we are always working on new ways to convince people to become customers, client - Membrane Diffuser Solutions for Wastewater Treatment Systems
In the aeration basin of a typical wastewater treatment plant there are both organic and inorganic m - Another Year Hating Your Job or Loving Life?
Copyright © 2007 Mary Foley I've come to the conclusion that to be successful - really successf - Dyestuff Industry In India And China
World demand for dyes and organic pigments to touch $10.6 billion in 2008According to a study on dye - Cma-cgm Case : the Series of Lawsuits Continues in Syria, Lebanon, Egypt, France, England and the United States
Damietta company case : The series of lawsuits continues in Syria, Lebanon, Egypt, France, England a