Approaching - let alone impressing - investors for your business can seem a tricky and daunting task. So, we spoke to Owen McCormack, director at investment firm Winton Ventures about what you can do.
However, don't look to close a deal in your first meeting.
'Most investments are made when an entrepreneur does proper research to find out what interests a particular investor, creates a good relationship and demonstrates their ability to create and lead a valuable team around an idea. Accelerators are a great way for an entrepreneur to do this,' McCormack tells UKBF.
'Investors see hundreds of businesses looking for money every month, so anything that helps your business to stand out is a massive benefit.
'Showing that you have something that customers want and that other investors take you seriously will help get the attention of investors. Cold emails rarely work,' McCormack advises.
McCormack tells us: 'Events are a good way of expanding your network within a certain industry. The bigger conferences can be overwhelming and are sometimes very expensive, smaller events in London are often as effective.
'We are really lucky in the UK because we have a healthy number of early stage investors so it won't take long before you've worked out who the key ones are that invest in your industry. Do your research and target just the investors that invest in start-ups in your sector and stage of growth,' he says.
'Accelerators and Incubators are a great way of expanding your network and meeting mentors, as well as potential investors and customers.
'Winton launched the programme to create a hub for data-driven start-ups in West London and bring talent together to collaborate and learn, and we want to find suitable investment opportunities,' he says.
'A lot of attention has been given to so-called unicorns recently, especially those that are social media or consumer focused.
'London and the UK have a long history of financing innovative companies that can turn science and imagination into companies that can create real value,' Winton told UKBF.
Mark T Jones outlined a few of his helpful tips:
'Don't pull figures out of the air. Do a best and worst case scenario; show what will happen if your business gets no clients or customers for six months (or a year for some industries).
'Too many people go to investors trying to make out their business idea will be the best thing since sliced bread, but have nothing to back those claims up. Investors aren't stupid, they know what they're doing or they wouldn't have made enough money to be investing in businesses,' he wrote.
It depends on the situation - but it will help to either have figures memorised or at the very least to hand when you're meeting with or approaching an investor.
How do you recommend impressing an investor?
First meeting: Don't look to close a deal
According to McCormack, there are a few 'love at first sight' stories where an investor meets an entrepreneur and a cheque is signed there and then.However, don't look to close a deal in your first meeting.
'Most investments are made when an entrepreneur does proper research to find out what interests a particular investor, creates a good relationship and demonstrates their ability to create and lead a valuable team around an idea. Accelerators are a great way for an entrepreneur to do this,' McCormack tells UKBF.
Stand out from the crowd
Put yourself in an investor's shoes. You'll see many business every month, all looking for funding. So just like a job application, you have to make yourself appear different and worth investing in.'Investors see hundreds of businesses looking for money every month, so anything that helps your business to stand out is a massive benefit.
'Showing that you have something that customers want and that other investors take you seriously will help get the attention of investors. Cold emails rarely work,' McCormack advises.
Attend events
You'll never meet an investor sitting in your office or by hoping and dreaming. Getting out and about to places where they're likely to be is a good starting point. The next is to bite the bullet and introduce yourself.McCormack tells us: 'Events are a good way of expanding your network within a certain industry. The bigger conferences can be overwhelming and are sometimes very expensive, smaller events in London are often as effective.
'We are really lucky in the UK because we have a healthy number of early stage investors so it won't take long before you've worked out who the key ones are that invest in your industry. Do your research and target just the investors that invest in start-ups in your sector and stage of growth,' he says.
Take part in an accelerator or incubator
We've recently written about four niche incubators and accelerators in the UK this year, including Winton's own Winton Labs for data-driven startups. McCormack says taking part in a programme is a great way to make connections.'Accelerators and Incubators are a great way of expanding your network and meeting mentors, as well as potential investors and customers.
'Winton launched the programme to create a hub for data-driven start-ups in West London and bring talent together to collaborate and learn, and we want to find suitable investment opportunities,' he says.
Be optimistic!
The startup landscape in the UK is a vastly positive place. McCormack says he believes there's a lot of potential for growth in the UK and Europe in general, for innovative companies 'that can make a big difference to businesses'.'A lot of attention has been given to so-called unicorns recently, especially those that are social media or consumer focused.
'London and the UK have a long history of financing innovative companies that can turn science and imagination into companies that can create real value,' Winton told UKBF.
Demonstrate your knowledge
We also asked UKBF members for their best advice when it comes to wowing investors.Mark T Jones outlined a few of his helpful tips:
- Focus on the business, not the idea or product
- Be intelligent in your assumptions
- Target investors who have reason to be motivated by your business
- Keep it brief and simple
'Don't pull figures out of the air. Do a best and worst case scenario; show what will happen if your business gets no clients or customers for six months (or a year for some industries).
'Too many people go to investors trying to make out their business idea will be the best thing since sliced bread, but have nothing to back those claims up. Investors aren't stupid, they know what they're doing or they wouldn't have made enough money to be investing in businesses,' he wrote.
Know your figures
Ashley also pointed out that it's important to show how you're going to pay your investor back. As such, it's important to have a grasp on your figures.It depends on the situation - but it will help to either have figures memorised or at the very least to hand when you're meeting with or approaching an investor.
Be yourself
Gary K said while figures are very important, ultimately the investor is going to buy into you. So be yourself, above all. If you're going to be working with this person for potentially years, they need to know you and what you're really like - and vice versa.How do you recommend impressing an investor?
