Investors, especially TMT Investors, are presented with more opportunities than they can realistically filter: so how do you make sure you stand out from the crowd and get the attention you really deserve from them?
One of the burning issues for growing TMT businesses is securing funding, but how on earth does an entrepreneur get an investor’s undivided attention amid all the other white noise.
At 4 Oceans Capital we have helped numerous young and growing tech companies get access to Seed funding and beyond into Series A and B rounds. Its easy to say that the sector is crowded with entrepreneurs hungry for funding and with a finite supply of investment sources and capital available it is often difficult to know where to start and how to generate interest in the investor community. owe have picked up key tips and learnings that are key for all growing businesses that are looking to attract funding, whether it’s the first time or Series A and beyond.
Approach the right Investors
Think about who will truly believe in the company and will bring value to it as an organisation by their involvement. It’s not only about the money, although cash is obviously what you are seeking.
Depending on what stage of funding your business is at, it’s worth bearing in mind that in the early phases, financial backers tend to put a lot of emphasis in the founders and the strength of the management team, over and above other factors. Although there obviously needs to be a large enough market opportunity and your plan needs to stack up.
On a different note there is no point in approaching an investor who already has a similar business in their portfolio, not only are they unlikely to invest in you, you may give them ideas to share with their portfolio company.
Stats, stats, stats
That leads to the next point of knowing your stats. Investors want to know the numbers and metrics, so make sure you are always up to date with the latest digits in all aspects of your company.
You need to know these back to front and if you don’t, get someone who does. This will affect how you will answer the types of questions that investors will ask, including: how will you make money? How will you make money for your investors?
How are you going to close sales? What are your marketing expenses? Can you actually grow that fast? What will you do if you do not hit your numbers? Make sure you have proof points for all these questions before you start talking to investors.
Show off your team
As a growing technology company, you worked hard to build the team you now have, so show investors how the team in turn is passionate about the company. Particularly in the earlier rounds, where you do not have a proven business model.
As the investor’s focus shifts from proving out the business model to growth, the team should remain a focus as the investors need to be confident that they can deliver on the ambitious plan you present to them. You cannot deliver without your team, so ensure you show investors why your team is best placed to execute on your plans.
Pitching time
When it comes around to pitching time, stand out from the crowd by delivering a memorable, short but sweet pitch. It may be easier said than done, but what will differentiate you from the countless other technology companies is the point you bring across in a short time frame.
If you can keep the pitch concise while bringing it to life, the formula will be cracked. The whole time while you pitch, make sure you remember to think from the investor’s perspective: if you want to be taken seriously you have to always refer back to your business plan. Don’t confuse them with long detailed technical information about your product. Show them why your team and product is more likely to succeed in the market.
If you manage to put all of these elements together at the same time then you will no doubt succeed in your fundraising endeavors.
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