Finding Investors for Your Business
- According to Entrepreneur Magazine, friends and family are some of the most dependable resources for any entrepreneur. Approaching people close to you can be difficult, so come prepared with a detailed business plan and treat friends and family like business partners. Before you meet with friends or family members to ask them to invest in your business, decide whether you will ask for a loan that you will pay by a certain date with interest or an equity relationship, where they will own a percentage of your new company.
- Angel investors are individual investors who provide fledgling companies with seed capital that is anywhere from a few thousand dollars to as much as $1 million. There are numerous organizations that match angel investors with entrepreneurs, such as the Go Big Network, Active Capital or the Angel Capital Association. Go to each of these websites, and join their networks to search for angel investors for your business.
- One of the best ways to find investors is by simply networking and talking to those around you. For example, talk to your banker, who may have advice for securing a loan or dealing with investors. Or go to your local Chamber of Commerce meetings and speak with other business professionals in your area who may be able to connect you with investors. Attend business association meetings and conferences relevant to your industry, and "work the room" by approaching as many people as possible to discuss your business plan.
- Venture capital is financial funding provided by investors to early-stage, high-potential start-up businesses. To find venture capital investors for your business, check out the National Venture Capital Association's website. Click on "Resource," then "Venture Capital Organizations" to find descriptions and contact information for regional venture capital associations. Choose several of them to contact, and send a letter expressing interest. Ask if you can meet with them to discuss your business plan.
Friends and Family
Angel Investors
Networking
Venture Capital
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