Raising Funds For Your Startup Business: Guide To Approach Investors
How To Approach Investors for funding

Raising Funds For Your Startup: Guide To Approach Investors

An entrepreneurial journey is interesting. Full of ups and downs, this rollercoaster ride will take you from nurturing the seed that your idea is to grow, flower and bear fruit. This journey, however, is not without its usual hiccups. From a bird’s eye view, a startup will always seem like a great idea.

You think of an idea, you see that there is a market for it, you scrounge together some seed capital and start your work towards creating a product, and however, every nascent startup is plagued by a problem they cannot get away from. Funding. A startup might not have the expenses of a corporate organization, but it still needs funding to ensure that the groundwork is in order.

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From hiring missing talent to procuring frameworks required for your company, everything needs financial assistance that a startup might not have. The easiest way to gather finances is to get customers to buy your idea, but the groundwork required to reach those customers also needs money.

That is where investors come in. Investors are companies or individuals who recognize the tenacity of an idea and how it may be profitable for them in the long run. Investors can provide solid financial backing to ensure that you can focus on the product, rather than worrying about the financial nitty-gritty and being able to hire an individual who can take care of the finances for you.

These investors, however, are hard to come by. Here is a handy guide that will guide you in your entrepreneurial journey and will help you approach investors with confidence.

Step-by-Step Guide To Approach Investors

Step 1: The basics: Reaching out to a potential investor

Approaching an investor requires some homework. Every investor needs facts, basics, and numbers. Before you reach out to an investor, understand your needs.

Do you really need funding?

This is the most important question. Do you really need funding? Investors rarely offer an olive branch to startups. They might go for equity or a large share in your startup in exchange for the financial assistance they may offer you. If you think you’re in the green, start focusing on your idea and cutting unnecessary expenditures instead of looking for investors at the outset.

How much is enough?

The amount of investment that you need is important. You may get by with a particular amount in a year, but proper groundwork and analysis will help you assess your current expenditure, projections for the next four to five years and growing company size. All these factors together can help you arrive at a number.

How are you managing your finances?

Every investor is interested in where their money will go. Make them understand that you manage your finances well, in a controlled manner for them to understand that their funds will not be squandered away in a golfing set. The money will be put to good use, to grow the company and not for personal goals.

Team size

Unnecessary team members can rake up costs. Keep the people you really, really need and let go of the ones that are currently a drain. You can always hire more, but let go of people dents your company’s image in front of potential investors and employees.


If you already have customers, your annual revenue report is a good indicator of the amount of money they can invest. If they see profits, your investment will be higher.

Profit/loss statement and current venture status.

Your current venture status, its stability and the ability of the company to constrain itself is gauged from the profit/loss statement. Investors need these reports to gauge your idea’s health.

Step 2: Initial interactions with investors

The first impression that you make on an investor will be the last impression. Remember – in the short window that you will get to see an investor, you will need to sell your idea and generate enough interest in them to compel them to agree to invest in your idea.

Get introduced

Investors need to know who is getting their money. If you’re introduced to them via a mutual contact, there is a higher chance of converting the meeting into an investment agreement.

Build a rapport

It is important to make the investor understand that you’re here to build a relationship, and not just for money. If you gain the investor’s trust, the chances of making him invest are higher.


Be clear when you describe your business plan. Investors tend to stay from a plan that is going in circles and is confusing. Be clear, precise and to the point.

Step 3: Points to consider for your pitch

Your pitch is as important as your idea. If you cannot make people understand what you are selling to them, the investment is unlikely. Consider the following in your pitch:

1. Your business model and plan.
2. Your traction product. What will gain you a footing in the market
3. Your revenue model. What will make you money?
4. The future of your business. How sustainable is your business?
5. Your competitors. Make them understand that you know the market.
6. What makes you unique? Why you.
7. Your team. Describe who does what.

Step 4: Dos and don’ts

Remember these points when you approach an investor.
1. Showcase yourself as a team
2. No one likes to invest in a one-man army.
3. Do not seem desperate
4. Start your pitch with an introduction. Do not go directly to the point that you need money.
5. Be precise
6. Stay to the point. Do not beat about the bush. Let the investors know what they need to know. Leave out unnecessary details.
7. Practice
8. Practice your pitch. Do not fumble when you’re with investors.

Entrepreneurship is a game of patience, perseverance, dedication, and teamwork. With the right tools, the right people, the right product and the right vision, you can make your idea go places. An investor can help you get to those places with the right funding at the right time.

We at Volumetree are well versed in the entrepreneurial process and can help you at every stage of your journey. We maintain a very close relationship with over 40 angel investors of the Chandigarh Angels Network. We can help you get ready for your pitch and help kick-start your journey faster.

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