As many start-ups have ideas to create a global impact with their business but they may be limited to a certain limit due to lack of funds which is a major drawback for an entrepreneur. Therefore, how to originate funds for your start-up is directly proportional to How to onboard the right investor for a startup. Do research well about the market you target and accordingly get the right investor who takes interest in your ideas.
Onboarding a knowledgeable and experienced person is very necessary as they will not only help you in funding but also guide your ideas to a successful path. Investment can be done by many rich people but if they lack interest in your start-up then you might end up just paying them their shares in return for a few more burdens. More often, to get investors, young entrepreneurs select those with whom they share and build ideas; this is a very profitable choice for your start-up but only a few lucky people can experience it.
How to onboard the right investor for a startup.
Keep your ideas well organized
The raw data or idea for starting a start-up can originate from anywhere – it can be you, your employee, your colleagues, your family, or even a stranger. If you manage to obtain all of their ideas it can be a complex bulk of junk in your head that can be of no use for yourself so do not even think to present this junk in front of your investor. Even in the worst cases, you can jumble up one’s idea to another which can be a downfall for you to even think about starting a business.
The best you can do to keep your ideas well organized is to follow these simple steps:
- Gather all the people at one place who are interested to provide you with raw data. Make sure you take it seriously like a meeting and properly note down whatever you think is useful for you. Consider it as the first and the most important meeting for you so that at once you can remove the unnecessary idea which you think is not worth it for your start-up.
- Prefer to categorize the raw ideas, as there may be two people sharing the different ideas on the same topic which can be later on checked and determine which is to be considered useful. Categorizing makes it easy to search everything at once, topic wise which makes searching pretty easier for you.
- If each category has a large amount of data that is to be compiled and it is time-consuming then assign a teammate to that category. This will increase the functioning of your start-up in all aspects and you will also be able to focus on refined and useful ideas.
- Discard some ideas instantly which you think is not viable. But the leftover ideas cannot be implemented directly, they will also require some inputs by you or any senior person. Before finalizing any idea discuss and curate deeper in the specific raw data to obtain the perfect executable data.
Have your team
You can create your ideas alone but cannot build a start-up to a well-recognized business without a helping hand therefore How to onboard the right investor for a startup is necessary. According to a survey, success or failure is 23% dependent on what team you choose, in the success or failure of your start-up. Building up a team is neither too tough nor too straight; you cannot trust anyone without judging and interrogating them well.
Include those people who have contributed positively by providing you with the raw data for your startup. There can be many but choose the one who can break complex situations in a short and simple procedure. Not every contributor can be concluded in the team as they are with you for some kind of small or large profits.
Create your team and consider them as contributors because this will make them feel like a family in which they are contributing to rising altogether. This will make them work hard and with more dedication.
Few basic qualities to be checked in a teammate are as follows:
- Calm and cool mind.
- Gathering information in an accurate depth.
- Breaking complex problems into simpler forms for better solutions.
- A smart worker is always preferred over a hard worker.
- Capable to guide the startup from facing any panic situations.
Design your Business Model
A business model is compulsory to maintain your start-up’s procedural understanding which will help you in onboarding the right investor. Without a business model, you and your teammates can be stuck in a loop while converting your raw ideas into accurate information. The business model will act as a time table for your startup, which means everything will be conducted properly and linearly.
Spiral Model, Waterfall Model, Prototype Model, and Joint Application Model; these are a few basic models that you can easily consider for providing a path to your startup. These models are basic but one can easily implement them to attain the flourishment of a startup periodically.
Therefore, following a business model is not rocket science nor you need to hire any specialist for this; you just have to assign checkpoints carefully to any of the applied models and you will experience everything done with ease.
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Do Startup Registration and Documentations Ready
It is very necessary to register your startup or company with the regional authorities as this will help you to avoid any kind of legal matters later on. Registration will not only protect your startup from legal issues but also makes your company eligible for business loans. It is a little hectic task to register your startup with legal authorities, as it requires a lot of paperwork.
Operating a startup without registration is against laws and to obtain business loans you need to present your company’s legal papers in front of the concerned bank. If you are legally registered then it is easy for an investor to invest because it generates trust that he is investing in a startup that is legally authorized.
If we talk, specifically about India, I would not suggest you, for operating any startup without registration because it can be shut down immediately without providing any chance, defending your startup.
How to attract investors for your start-up?
How to onboard the right investor for a startup or attract the right investor is not an easy task as the investor should be interested in your product rather than your future company’s wealth. You may get many investors while growing your startup but choosing the right one; who can understand the product’s market rather than the company’s growth at first; will be a grateful choice for you.
Few important things to examine in investor before selecting-:
- He or she shares similar thoughts about your product.
- Must be interested in the product more than the company’s future wealth.
- He or she must possess equal problem-solving skills the same as you.
- Help in dealing with low key points of a startup.
- Must know the product market you are selling.
What is the investor’s interest in your start-up?
Like till now we discussed, onboarding the right investor for our startup; from this, we can find that an investor does not mean providing us only the money for our startup but also needs to work hard for our startup in a similar way as we do. From this, we can conclude that an investor should know about our product, the product’s market, and as well as the environment in which we are entering.
To find out what is investor’s interest in our startup is easy because there are only two things an investor will possess at the starting; one is the future wealth of the startup and another is the future of our product which we are trying to sell in the market. So, we know that the investor who is looking for the future of our product is the right person to be considered as an investor for our startup.
Investor’s interest in our startup is as follows:
- The startup is following a specific business model to carry out the task.
- Future of the product on which our startup depends on.
- Product’s existing market.
- Well organized team with specific tasks assigned to them.
- Will the product last long in the future.
- The startup is authorized legally and has proper documentation.
These were the major things that you should follow regarding How to onboard the right investor for a startup. Keep in mind that finding investors is easy but selecting the right investor for your start-up matters a lot as they should equally contribute to all the efforts you are trying to make alone. Even after selecting the investor if you feel that you are carrying out all the tasks one-handed then you have opted for the wrong person as an investor.