Your idea may very well be the next big thing. It could have the potential to be a bona fide success. But if you want to get serious investors interested in your startup, you’re going to need more than just a brilliant idea.
VCs and angel investors will see dozens of offers coming through their doors and inboxes every single day. So how do you set yourself apart? It’s called organisation. Get the investors with the real money interested by ensuring that your startup is a real business from top to bottom and doesn’t just rely on the potential of your idea.
Have an Implementation Plan
Remember, investors are business people themselves. They don’t just want to be convinced by your genius plan, but they want to see how you’re going to implement it from start to finish. This means having a proper plan to scale up, how you’re going to market and distribute, and how you’re going to support your product or service going forward.
Consider the details, as that’s exactly what your investors will be interested in. Don’t get bogged down in theory but have an actual real-life plan that can be implemented the minute you open your doors. Run through the plan with your business partners or third-party and make sure you don’t have an ‘errr…’ moment when a question is asked.
Sort Out Your Finances
Should your business be up and running already, investors are going to want to have an in-depth look at your books. And if you want to stand a chance, they’re going to need to be squeaky clean. No inconsistencies, no missing receipts, and your projections should be based on realistic numbers.
When you pitch your business, have a thorough understanding of the financial aspect. You’re going to get just as many questions about your actual idea as you are about the financial picture. Be ready to defend your costs and why you think your projections are accurate.
The problem most startups have is that documentation is often horrendously deficient. And investors won’t like it. You’re going to want your business documented from top to bottom right from day 1. It’s an arduous process, but it’ll be worth it down the line.
To make things easier for you, leverage technology. For example, use Basecamp to track your projects and exchanges between yourself and clients. Redmine is great if you need to track specific software issues, giving you a platform on which to base project estimates in future. We also recommend that you record everything that happens in your big meetings and then transcribe it so that you have documentation (don’t worry, there’s a service for that!).
Remember, the process of documentation only becomes easy once you get a process put in place that runs like clockwork. Train your staff to follow a procedure, use time-saving tools, and always have backups of absolutely everything.
Build a Solid Team
Building a good team is all about balance. Don’t limit your core group to those that are experts on your product, but don’t quite get the numbers game. Include a variety of types, from those who are great with bird’s eye view strategies to people that are all about the details.
Investors will often look at the team before the actual idea that you have. It’s likely that if they do end up giving you a cash injection they’ll make tweaks to your plan anyway. That’s completely normal. Investors don’t necessarily want your plan or idea to be 100% perfect, but they do want a team in place that they’re confident can get the job done.
Block Your Competition
Once you hit the market, what’s going to stop competitors setting up shop to compete directly with what you’ve got on offer? That’s the kind of question your potential investor is going to want the answer to straight off the bat.
Ask yourself whether you can build any barriers that will stop competitors from stealing your unique selling point. Organise your business in a way that you’ll hit the ground running, which will allow you to build a reputation and brand recognition that will dissuade others from joining your niche market.
Finally, Present Your Idea Effectively
Ultimately, your business stands and fall on the strength of your idea. But don’t rely on your idea to speak for itself. Don’t forget that your investors will probably have no idea about your potential market or how your proposed business actually works. Don’t assume knowledge and ensure you spend plenty of time organising how you will present your idea in that boardroom.
Once you’ve finalised your presentation, take it through a couple of test runs. Does your audience ‘get it’, or are they left confused and not sure about what your product is actually about? Your pitch is something that you’ll use with potential customers as well, so make sure it’s absolutely perfect.
The mistake that startups make is that they spend too much time focusing on exciting aspects of starting a business. And that’s why so many good ideas fail to get financial backing. If you want your business to get the investment it deserves, ensure that you spend plenty of time on the organisation side of things.
Image credit: Pixabay
About the Author:
Mary Ann Keeling is a freelance consultant and an experienced social media networker. She likes to spend her free time cycling and doing water sports with her friends. Connect with her on Twitter – @MaryAnnKeeling