Investors are a critical part of any business’s success. They can provide capital, advice, and contacts that can help you grow your company. However, finding the right investor can be difficult. If you’re looking to get business funding from an international investor, you’ll likely need to go through a longer process than if you were seeking investment from someone in your own country.
In this article, we’ll look at five ways to get business funding from international investors.
Most startups struggle with getting capital, which strongly affects the business’ growth. A study shows that 9 out of 10 startups fail, and a lack of sufficient capital is one of the reasons why they do. With capital, you get the necessary head start towards building a successful business.
It is very important for a start-up to raise enough capital in order to ensure that they have a shot at being successful. With enough cash before implementing their business processes, they have a better chance for business survival. Since a study shows that lack of cash accounts for 30% of a startup’s failure, it is therefore important to have funds available before attempting to scale up the business or even expand the business operations.
As a business owner, whatever your plans for your business are, you can get business funding by seeking out investors that are looking for profitable investment opportunities. The good thing is that they are not only looking within their country, but they are also looking at other countries as well.
You can get business funding by looking out for international investors and we’ll show you how.
Get business funding fast with these 4 measures
1. Understand the investor’s mindset
To get business funding from international investors, you need to:
- Understand the investor’s mindset.
- Know what they are looking for and their goals.
- Understand the needs of your project, as well as your team’s needs.
- Understand their vision, strategy, and situation (this will help you to focus on one thing).
2. Establish a business plan and solid metrics
A business plan is a roadmap for your company. It should include a description of your business, its goals and how you plan to achieve them. It should also include a financial forecast and an analysis of the market.
To get business funding from international investors, the first step is to develop an effective business plan that documents everything related to your venture’s mission statement, including:
- Your target market—who do you want to sell into? Who/what will be their needs/desires when they buy from you?
- What problem(s) do customers have that would cause them to buy from YOU rather than someone else (e.g., price point; quality)? How can you solve these problems by delivering something better than what exists today in this market (e.g., customer service)?
3. Do your research before approaching an investor
Before approaching an investor, it’s important to do your research. To get business funding, here are some things you should look at:
- The investor’s background. What are they doing and why? How long have they been doing it? Do they have any other businesses in the same field as yours?
- The investor’s interests. Are they interested in investing in startups that solve specific problems or do they prefer working with companies with high growth potential and strong margins (like Facebook)?
- The investor’s history with other startups (and their investments). If an entrepreneur has been successful before, chances are good that he or she has already made his share of mistakes too—and those mistakes may help explain why certain investors may be reluctant to put money into a company at this point in time.
4. Know where to find investors
Investors are everywhere and you can find them online, at events and through referrals. To get business funding, here are some tips for finding investors:
- Online: Search for blogs or forums that discuss your industry or niche. Look for people who have made similar investments in their own business as well as those who are willing to help others do the same thing. If you’re looking for investment opportunities in your country, consider searching local newspapers or websites that cover local news topics related to your industry or niche.
- Events: Attend conferences where entrepreneurs meet with potential investors face-to-face; this will give you an opportunity to talk about what motivates each other’s businesses while allowing others present at these events access to potential partnerships (or business deals) without having gone through all of the work required beforehand—an important consideration if one wants quick results rather than a long-term commitment from anyone involved!
There are intermediaries that also provide a platform for businesses and potential investors to interact. These platforms serve as some sort of protection to reduce risk and build trust.
5. Be interesting
When you’re pitching investors, be interesting. The best way to get their attention and get business funding is by being an expert in your field and having a unique story. If you can show that you have something special going on and are making progress toward your goals, investors will want to hear about it!
If your business isn’t interesting enough for investors—or if they just don’t see how it relates directly to their own needs—then consider trying another avenue of funding: angel investing.
Angel investors are individuals who invest money into startups or existing companies without expecting any kind of return on investment (ROI). They typically look for potential returns through future sales or stock distributions; however, some may also provide loans at low-interest rates so long as the startup meets certain criteria set forth by its founders/owners (such as having solid plans).
You should also keep these in kind if you want to get business funding from international investors:
1. Prioritize documentation and compliance
Your region determines which documentation and compliance process you have to do. Register your business with the relevant authority, and ensure that you complete the documentation required. Investors want to be sure that your business complies with the regulations that apply in your region. That way, they have some sort of guarantee on their investment. They are sure that their investment will not be compromised if you break the rules.
The documentation makes you prepared and ready to begin your business as soon as you have the investors that you need. It makes you deal-ready as well. Have a detailed description of your competition, pricing and financial model, organizational structure, company leadership, and product, along with any related documentation. Once you have these, your business is ready to roll.
Also read: How to Perform a Basic Accounting Audit
2. Be conscious and cautious of fees and charges
One way to find international investors is to use a finder. A finder is a company or an individual that assists businesses to locate possible or potential partners or investors. They make it easier to get business funding, at a cost. Their fees could be exorbitant, so you must be conscious of such fees and charges.
A business owner seeking funding should also have knowledge of the Forex Market and how it works. How banks rate affects currency pairs. Beware of recurrent charges, such as taxes and annual fees that your investors will have to pay before and after making an investment agreement with your company. Whatever fees and charges apply to any of your choices, anything above 10% of the funding should be considered excessive.
3. Take advantage of technology
With technology, there is a change in the way investors can interact with potential businesses. With technology, investors and business owners do not need a third party to connect them together. There are platforms that allow investors to invest in businesses outside their home country without intermediaries. With the right platform, there are people who are interested in an investment opportunity, regardless of the location. So take advantage of technology in order to connect to potential investors.
As you can see, the process is not as daunting as it may seem at first glance. It just takes some research, planning and creativity to make it all happen.
We hope these tips will help you to get business funding from international investors that you need!