Are you an aspiring startup founder looking for investment? If so, one of your best options is to seek out a business angel investor. These investors don’t just provide money, but also offer valuable advice and networking opportunities that can be the difference between success and failure. But before they will consider investing in your business, you need to convince them that it is worth their time and money. So what does it take to persuade a business angel to invest in your startup? Read on for our guide on the science of persuasion.
Know what you’re selling
Before you even start thinking about how you’re going to convince a business angel investor, it’s essential that you have a clear understanding of your business and the product or service that you are offering. You must be able to explain why your idea is different from the competition, why it appeals to potential customers, and why it has the potential for growth and success. Make sure that all these points are backed up with data showing market research, customer feedback and financial projections.
Have a solid business plan
A good business plan outlines all aspects of starting up and running your venture, from management roles and responsibilities down to details such as sales targets and marketing strategies. Showing investors that you have thought through every detail will help them understand how feasible your project is, how confident they should be in investing their money into it, and how much return they can expect from their investment.
Build relationships with potential investors
It’s important to remember that business angels are people too! To get them interested in putting money into your startup, it’s key that you build relationships with potential investors before asking for money. You can do this by attending relevant events (like hackathons or incubators) where they might be present, or by using social media platforms like LinkedIn or Twitter to connect with them online. Alternatively, many investors advertise their services online so make sure you keep an eye out for those too!
Pitch persuasively
When it comes time for the big pitch meeting with a potential investor, make sure all the above bases are covered first – if not then this could be where the investor starts doubting your project! Also make sure you craft an effective presentation – think about what makes something persuasive (for example using stories rather than facts), practice delivering it so that it flows naturally, aim for authenticity instead of over-selling yourself/your product/etc., emphasize benefits rather than features (why should they invest?), focus on emotions as well as reason (what values do they share?), include visuals whenever possible etc.. Ultimately though keep it short – 10 minutes or less – as nobody likes being talked at!
Be prepared for questions
No matter how good your pitch is there will always be questions from investors – both expected ones (how will I get my money back?) and unexpected ones too! It’s important to anticipate these beforehand so you know how best answer them when they come up during discussions (hint: practice makes perfect!). Having said that also remember not to just stick rigidly to pre-prepared answers as some questions might require more creative solutions – show them that you can think on your feet!
Following these tips should help put you in good stead when it comes time for convincing a business angel investor about the merits of investing in your startup – good luck!