Follow these steps to increase your chances of successfully raising funds for your business, advises John Auckland of TribeFirst.

Raising funding for your business can be an arduous process. It’s difficult for all types of businesses, and there’s not a lot of advice to go on. How do you create an investment deck? What’s the most appropriate language and terminology? What are investors actually looking for? However, there are some rules when it comes to developing an investor comms strategy, and from my involvement with more than 30 fundraises, I’ve created a system that’s remarkably effective.

The Investor Journey

You need to ensure that the investor sees the information you intend. For instance, if you send over your pitch deck before you’ve had the chance to develop a relationship and tell them about your company, it probably won’t have much impact.

When you connect with a potential investor or funder, you’ll first send the prospective investor an executive summary. This summary should fit on one page and include:

• The full terms of the deal – the amount you’re seeking and the type (loan, equity, bond, etc.)
• Key information about your business such as the number of employees, projected or actual customer numbers, etc.
• The directors and management team
• Your point of difference (which you base on your hot button research)
• Past experience or successes
• Current traction 
• Any other key information that’s likely to help them make an investment decision.

The investor will review your executive summary and ask you to send over your deck. This is a hugely positive signal and a sign you should attempt to initiate a face-to-face meeting, video conference or, failing those, a call.

In Association with

If you still haven’t sent them your deck, you’ll need to send a stripped down version with no text to distract them. You’ll then talk them through your business model and its strengths. Only once you’ve had a successful live interaction with the prospective investor do you leave them with a version of your presentation. 

Investor Hot Buttons

An investor’s primary objective is to make a return on their investment, but beneath this motivation are an array of biases – or ‘hot buttons’. While investors want to believe that backing your business will bring them a decent ROI, their trust in you will be triggered by their hot buttons.

For example, if an investor makes regular money from a property investment, they might be interested in investing in a property development business. This way they can diversify their portfolio – their hot button in this case – but through a business model they understand and have faith in.

A hot button is a proposition that chimes with an individual’s worldview, and there are generally two types that you can influence: emotional and rational. Hitting an emotional hot button might involve presenting an environmentally-minded investor with an innovation that protects rainforests, for example. 

Pushing another hot button may involve offering an investment opportunity to a teetotaller who recognises the soaring craft beer trend. If your investment doesn’t trigger at least one hot button you’ll have a harder job. 

To locate an investor or funder’s hot button, have them look at your pitch deck and financial model and ask two questions: What stood out to them the most? And, what was their biggest barrier to investment? Getting answers to both questions will give you a more realistic view. To ensure the answer is genuine, have someone independent ask the questions.

Face-to-Face Communication

There are a few key skills you can adopt when meeting with an investor face-to-face or over video conference (to a lesser degree on the phone). They include:

Active Listening While your pitch documents will be fairly fixed by this stage, by listening to the investor you can tailor your presentation towards the areas they’re interested in. Always ask them about what they like to invest in before you pitch.

Identify Their Hot Buttons You’ll have already identified one or two key highlights of your pitch that are likely to trigger their hot buttons. It’s better to find out early on if your hot buttons don’t match. It’ll save you a lot of wasted meetings and follow-ups.

Mirroring This is a technique where you make someone feel more relaxed by mirroring their body language, which is why face-to-face or video meetings work best.

Recognising Positive Buying Signals Closed body language such as folded arms means they’re probably not going to invest. But if you present yourself in a calm but engaging manner, they might then start to instinctively mirror you and open up. Other signals also include asking you more about the numbers, next steps and timescales.

ABC (Always Be Closing) Closing involves encouraging your prospective investor to reflect on how interested they are in your idea. Just ask them how they feel, what they like about your opportunity and whether they have any barriers to investing. 

Of course, no one can guarantee investment, but if you follow these steps, it will certainly increase your chances of raising funds successfully for your business.

 • John Auckland (pictured) is a crowdfunding specialist and founder of TribeFirst, a global crowdfunding communications agency that has helped raise in excess of £5m for more than 30 companies with a greater than 85% success rate. TribeFirst is the UK's first dedicated marketing communications agency to support equity crowdfunding campaigns,  and to provide PR and marketing campaigns on a mainly risk/reward basis.