3 Ways to Find Investors for Your Small Business or Startup

If you have a vision for a business, bringing it to life can be pretty time-consuming. The journey is full of hurdles, and obtaining adequate funding can be one of the biggest problems. Small businesses require additional finances at critical stages of their development. Statistics show that 20% of businesses fail within their first year of operations, with lack of funding being one of the biggest reasons. This is why small businesses often seek investors to raise capital and obtain startup funding. If you're looking for investors to fund your business, but don't know where to start, read this article to find three ways to get started.

1.   Attending Events

One of the critical factors for success in business and fundraising is to get noticed by the right investors, and attending different business events can be a great way to achieve this. You can even participate in other events where the investors you might be aiming for are likely to be, for example, sports or charity events.

Attending these events will help you present yourself to various influential people in the business, pitch yourself to active investors, and network with many people to build connections. If you are a startup or have an early-stage company, then some events you can consider attending are WebSummit, Money20/20, and SXSW. To be more productive, try to find out who is attending ahead of time and schedule meetings with them in advance.

2.   Angel Investors

Angel investors can also be a great way to obtain a large amount of funding for a startup or a small business in its initial stages. They provide the initial seed money for startups business in exchange for a percentage of rights to their company. They can provide you with mentoring, advice, and capital loans but typically expect up to 30% equity.

Many prominent companies like Google and Yahoo started with the help of angel investors. AngelList Venture, Angel Capital Association, and Angel Investment Network are well-known online platforms that can help you find angel investors.

Attending conferences arranged by angel networks can also be a great way to obtain international funding. Some prominent global networks include the Angel Investors Network (AIN), European Business Angel Network (EBAN), and the USA Angel Investment Network. Most investors require complete clarity on your business before deciding to invest, so you must be ready to answer all the questions regarding your business plan, successes, failures, vulnerabilities, and plans for the future in advance.

You must also prepare all your financial documents ahead of time and hire a financial translator to get them professionally translated if needed. This is because potential investors would likely go through them to see how much money your business has, what you intend to do with it, and whether they can trust you with their money.

3.   Accelerators

Startup accelerators, sometimes called seed accelerators, are mentor-based business programs that support early-stage growth-driven companies through guidance and limited equity funding. Accelerators mainly focus on helping startups that are at the pre-revenue stage. However, they can also assist an organization at all stages of development.

Startups that want to join accelerator programs have to apply, and if they get accepted, they will be put into a batch with other companies. After getting accepted, the program will provide the necessary resources and services, like advising hours, an amount of capital you can negotiate, and a shared coworking space. Most programs also regularly have guest speakers for advice and give you access to a network of potential customers and investors, helping you secure funding and customers for the future.

The term of an accelerator program lasts for three to four months on average and requires 3% to 8% ownership of the startup. Typically, accelerator programs end with a "demo day," where different startups and small businesses pitch themselves to a group of investors, which can help them get funding once they proceed independently.

Endnote

If you're looking for investors to fund your business, you can start by attending prominent business events, joining accelerator programs, or looking for angel investors online. Business events like WebSummit are full of influential people in the industry and active investors, so they can be a great way to network, build connections, and pitch yourself to prominent investors in the field.

Accelerator programs can grant you access to a network of investors and potential customers for your business and guide and mentor you if it’s in its initial stages. Angel investors are another great way to obtain funding in exchange for a percentage of your company's rights.