Do you really need money to grow your business?
If you want to grow your business, first ask yourself:
Do I need money or access to the market?
The reality is that many businesses can grow (albeit at a slower rate) without looking for equity funding. As one business financing expert comments, “The majority of businesses that come through my door think they need equity, but they don’t. The more immediate and important issue may be access to the market.”
The first section of the Investment Ready Guide explores non-equity alternatives such as strategic alliances, licence agreements and takeovers.
Tests and templates will help you find out if investment funding is the best option for your business or if your business is ready for investment funding.
Types of investors and investment stages
If you have exhausted all of the alternatives, Section Two will guide you through funding options, types of investors and the investment stages.
Each business stage may require a different type of investor. For example, you might use family and friends to start up, a business angel for early stage investment, a corporate investor for development capital and then a true venture capitalist for expansion capital. Often the earlier investors will sell out as other larger players move in.
Remember - just as investors will investigate your business, you need to investigate the investor.
Are you investment ready?
The final section of the guide explores what you need to do to attract investment - by having the right people, product and plan.
It looks at perfecting your pitch. This is essential so take the time to prepare and deliver a professional presentation. Rehearse, ask colleagues and friends to challenge you with questions and never leave things to chance.
This section also looks at valuing your business. You may find you need to consider a smaller ownership in return for an effective investor partner. Think long term. You may want to accept a more modest amount now, with the potential to sell your remaining share for a greater amount in the future.
