While raising the capital you are in fact selling yourself. It is up to the prospective investor, who is going to inject finance for you that how you are valued by him. When dealing with investors, you should be assertive enough by instilling trust and authority with all of professional courtesy and social respect. Rising capital is all about educating the market about your product, strategy and goal. You need to align your business interest with your investors and for this, you need to be detailed, compelling and assertive.
In order to develop your business in term of finances and catering innovation, you definitely depend upon the personal and professional network. When funding capital, present your proposal to those who comes first when matters comes about trust and mutual understanding.
There are two types of investors: active and passive, active investors add value by putting certain strategic efforts along with their money. Passive investors do not pay heed to how you are doing they simply give you finance for a considerable period of time and will take it back to derive capital addition. Your business situation will tell you, what type of investments you are looking for.
Figure out the amount of investment you need for your milestone: it may be launching new product, expanding existing operations and sales or buying another business division. A wiser businessperson prefers to rely on reserves for full or near half of the investment required for business expansion but we also know, this is not always possible. There are two options for capital rising available; debt and equity. Repaying loan taken from bank or any investor is far easier than recovering the ownership of your company that you have sold in form of shares in case of equity financing. Grants, bank loan and angel investments as well as venture capital approaches are better off. Debt financing in beneficial in terms you do not need to dilute your control as in case of equity financing. If equity financing is the last solution, make sure you keep high pieces of your company`s share with you. Try to avoid selling your company share more than 30%. Having more people on company`s board will make your company`s under unnecessary pressure. Many evidences have shown that over burden on company`s board resulted in failures of many profitable projects.
Once you have chosen the mean of financing capital, next stage is to make action plan to raise the money before you actually need it. Capital rising is a long and cumbersome process that may involve repeated efforts to convince the listener, financial experts have advised to be prepared for rejection and success after long process of follow up. You need to be patient and persistent in order to win.Inspire your investors by showing results of your improved sales and market share, provide them with past results that how soon you became able to achieve the financial target. Motivate them with the expected gain and timeliness of return on their investments. Adding assessment of your previous investors and their satisfaction towards you will definitely be a plus.