When it comes to raising funds for startups and other small businesses, having a distinct and efficient strategy to execute is paramount. That's been clear to Mark Suster since his days a startup specialist in the first tech bubble and as a VC in the second, where he contributes to the startup community by providing insider secrets from both sides of the table.
According to Suster, there are many things that a startup can do to further its chances at seeing an increase in fundraising, but if they startups don't streamline their efforts to find highly qualified candidates while also building a relationship with these potential investors, they may not see any checks being signed over. Therefore, startups and small businesses must first "qualify" their buyers. When these entrepreneurs focus on the investors most likely to contribute to their fundraising campaigns it allows them to streamline their productivity and become more efficient when preparing their pitch.
Furthermore, startups should also spend time researching the investors. Rather than using a generic pitch, entrepreneurs should use their research to find out the investment history of potential buyers and their current projects, then tailor the pitch to them. This research phase will also help form an understanding of their motivation for taking interest in the company.
And thirdly, it's critical that both parties meet in person to build a relationship. "They're not buying a book on Amazon or shoes on Zappos. They're buying you," says Suster. Startups who understand that people buy from those who they can like, trust, respect and believe will also find that meeting in person for more than just a 45-minute Powerpoint presentation will greatly increase the chances of receiving an investment from these venture capital firms or angel investors.
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