How to Find Investors for Startups

Finding the right startup investor to fund their fledgling business is a major concern for many startup owners. You might have the greatest business idea in the world, but, without solid financial backing, it is not likely to take off. How do you go about finding an investor though? Let us find out.

How to find investors for startups

Before you look for a startup investor, have a viable business plan and a clear idea about the funds you will need to launch your business. You must be able to explain exactly how these funds will be spent. Make sure that you have your business plan, expense sheet, financial statements, corporate governance documents, and all other necessary materials ready for review.

Once you are well-prepared to answer the various questions that potential investors are likely to ask, you can start searching for investors for startups. Bear in mind that it is not going to be easy. You should be prepared to meet and speak with many investors before you can find someone who will be interested in funding your startup.

Here are some ways you can find investors for startups.

Visit online platforms that aid startup launches

Many online platforms specifically help startups to locate and connect with the right investors. You can search online for the leading startup communities and sign up for free or paid memberships. You will be able to research differing funding sources and get information about investors who regularly invest in businesses like yours.

Get assistance from business incubators and accelerators

The main benefit of working with business incubators and accelerators is that not only will they invest in your business, but they will also provide you with all sorts of assistance to get your business up and running. They may work with you to make your business idea more viable, point you towards valuable business resources, and even offer you a physical office space for your business.

In return, though, you may have to grant them certain business partnership rights. Make sure you understand exactly what rights they want and that these won’t interfere with your vision of your business before you agree to sign a deal with them.

Apply for loans and grants from Small Business Administration

Small Business Administration (SBA) is a U.S. government federal agency that has been providing business aid and advice to small businesses in the United States since 1953. They have a “Grow your business” section which contains detailed information on getting funding for your business in the forms of traditional loans, credit, crowdfunding, company ownership stakes, and SBA-guaranteed loans. You can also get equity and debt investments from small business investment companies that are regulated by the SBA.

Find opportunities with angel networks

You can visit angel investment platforms like Angel Investment Network, Angel Capital Association, and others to connect with investors. After signing up with them, you can provide information about your business, the target amount you seek, and the minimum investment you expect per investor. Many of these platforms have knowledge centers that provide information about angel investing and offer access to newsletters, podcasts, blogs, books, research papers, data analytics, and other resources. They also organize webinars, workshops, summit meetings, and other industry events for entrepreneurs and angel investors.

Network on business social media sites

Business social media sites like LinkedIn, Xing, Meetup, and others are good places for professional networking. You may be able to connect and interact with local and international investors in your industry and even get their assistance in turning your business into a global enterprise.

Sign up for a crowdfunding site

Crowdfunding involves raising business capital by accepting small and large amounts of funds from a large number of people who are interested in your business venture. While different crowdfunding platforms have different financial and legal rules, the general trend is that the money given is by way of donation. You may not be legally obliged to return it or give the investors any stake in your company. It is good policy, though, to make it worthwhile for them in different ways, such as by offering them sample products, including their names in credits, arranging thank-you dinners, and so on.

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