Investors

The Train is Leaving the Station

By November 30, 2016 No Comments

To get investors excited about your business, you have to convey a sense of unstoppable momentum. You have to give the impression that your startup train is leaving the station with or without them.  Investors are notorious for dragging their feet, and too many spectating investors are a recipe for fundraising disaster.

Creating this feeling is much more an art than a science.  Landing an investor is like trying to get a first date: You have to look like a winner, move quickly, be in high demand, and not look desperate. Send out email updates at regular intervals with evidence of your impending success.  An end date on which the round officially closes is a good way to instill a sense of urgency in your investors. But this is also a gamble, because if you don’t have all of the money committed by then, you’ll have to extend the deadline, which is a negative signal.

The trickiest part is that all of this needs to happen quickly – in weeks, not months – to build a sense of urgency.  Moving swiftly creates a fever pitch, and causes investors go to extremes to jump on board.  To do this, you’ll need to start laying the groundwork many months in advance.  Plan carefully, and start communicating with investors early.

Matt Sand

Author Matt Sand

Passionate about making a difference through innovation and entrepreneurship.

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