Many women entrepreneurs don’t look for investment money; afraid they do not know enough to enter that world. But you have to remember, the investor wants you to be a savvy entrepreneur–not savvy at the investment markets.
Yet, there are specific things investors are looking for in order to fund your idea. Here are a few:
- A founder who has a strong vision, believes whole-heartedly in her idea, and is willing to do what it takes to see it happen.
- A team that compliments each others skills, is unified, and knows what additional skill sets they need to scale to a larger size.
- A founder and team that know their customer:
- Who are they?
- What do they need or what problem do they have?
- Where do they look to get this need met and problem solved today?
- How does this product or service meet their needs better than what’s available?
- A plan as to how you are going to move from idea to profitable business (see my training on Business Plans for help developing this plan if you don’t already have one.)
- A team with the requisite skills needed to execute the plan.
- A market large enough to produce revenues and profits that will yield investors ten times their investment in five to eight years. (Investors in start-ups look for high potential returns to cover the investments that fail, or perform below expectations.)
- An idea that is scalable to a size that can later go public or be bought out by a larger company. (Investors call this an exit strategy. You need to know what yours is, so they know how they will get their big payoff.)
“If you can grow quickly and profitably without outside money, there’s no reason to give up a percent of your company to others”, says Geri Stengel, writer for ForbesWoman, and I agree.
Talking to investors takes time and energy that you could be putting into your business, so pursuing this option should be carefully weighed.
However, too many women entrepreneurs keep their big idea small because they fear talking to investors and taking this step. If your idea needs other people on staff, equipment or investments in other assets and you do not have the capital–don’t stall out on a great idea because you are unfamiliar with the investment arena.