Almost every start-up is faced with the fact that at some stage it needs to attract external investment and competencies for more aggressive development. Accordingly, contacting a business advisory firm in India is the ideal option. We, in this article, will talk about the questions founders need to answer for the process of attracting investments to be successful.
Attracting investments is a large layer of work for the founder of the company and the key team. When broken down into components, founders need to answer four questions:
- When to go;
- Where to go;
- Why go;
- What to go with.
The answer to each of them turns into a plan of action. One missing element can make the process much more difficult. For your start-up to go all the way to attract investments without loss, we will consider the first three items in more detail.
When to go
The founder must be able to attract investments and sell his project to investors, and not just make a quality product. In start-ups, everything depends on people – investors understand this too.
Founder tips:
Learn how to attract investments on your own in the initial stages of the business – this will be important in the later stages of development.
When it comes to large businesses, someone needs to be involved in attracting investments on an ongoing basis – it should be one of the leaders or business consulting firms in Delhi.
Where and why to go
Founders’ circle of contacts is usually limited since fundraising is not their main job, but only part of their duties. If nothing is done about it, an unpleasant chain is launched.
The risks are purely mathematical: ten to twenty conversations with investors are more likely to bring results than three. There will be plenty to choose the most favorable conditions and the most suitable investor.
Here the founder again faces a dilemma: either you need to urgently start doing more networking to the detriment of operational activities, attract a partner with contacts, or outsource the task.
Knowing a wide range of investors, you will be able to select those options that will cover the needs of the business.
Some companies just need investments, others need competencies and connections to enter foreign markets, build a financial function, and so on, because the business is already paying for itself, but needs an impetus for explosive growth.
Sometimes founders do not understand which business development option is realistic at their stage of maturity and with their indicators: is it worth considering an exit or is it better to look for investments for development (and how much)? Or maybe there is not enough external expertise?
Business consulting firms in Delhi will help with the initial assessment simply because of their experience in this kind of task. But how to develop, where to go, and what new features to offer – no one except the founders can know this.
Tips:
Develop your networking or hire someone to do it for you: a consultant or partner. You need to reach out to a wide range of potential fund investors, not just old friends.
Decide what exactly you need from the fund: investments, competencies, connections. Different funds may offer different benefits for your business. You need a clear understanding of how much investment is needed (and where it will go), and how realistic your expectations are.